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PEL

PETROLEUM EXPLORATION (PVT) LTD.

Discovering Energy

Exploring the World

2013

Shahzad International Group of Companies

Engaged in diverse business pursuits

DEDICATED TO DYNAMIC GROWTH, SUSTAINED DEVELOPMENT AND MEANINGFUL ECONOMIC BENEFITS FOR THE GROUP AND ITS PARTNERS

FLASHPEL

PEL

Petroleum Exploration (Pvt) Ltd.

Shahzad International

Kandra Power Company (Pvt) Ltd.

Global Mining Company (Pvt) Ltd.

Shahzad Travels (Pvt) Ltd

Our Business

Shahzad CGG (Pvt) Ltd.

Flash Security (Pvt) Ltd.

FLASH

PEL

With the Group’s sound financial position, its

companies are in business independently, as well as in collaboration with foreign

partners, since 1980

The Group has been instrumental in bringing a number of multinational companies to Pakistan resulting in

substantial profitable investment that led to significant discoveries of Oil & Gas

Activities cover a wide spectrum, including oil & gas exploration &

production both onshore and offshore;power generation and transmission; mineral exploration & development

including gold, copper, coal and other minerals; oil & gas field services, supply

of oil & gas equipment and materials, process equipment; information

technology; security; telecommunication; production of

documents and trading

GROUP ACTIVITIES

The Shahzad Group, comprises seven (7) companies

The Group is pursuing a policy of forging strategic alliances with reputable

foreign companies

As a local partner, Shahzad Group is providing support to foreign companies

in Pakistan

PELPAKISTAN'S ENERGY OUTLOOK

Source: Pakistan Energy Outlook

ImportsImport bill

$ 50 Billion

0

20

40

60

80

100

120

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2015-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22

Local Supply Total Oil & Gas

Ever increasing Supply Demand Gap

Millio

nT

OE

s

Investment Opportunity

2011 – 2012

64.522 mtoe = 1,290,440 boed

PELPAKISTAN PETROLEUM SECTOR……

�Energy demand is met by local production and imports

�Gas contribution in the energy mix is around 50 %

�Annual energy growth is around 5.25%

�Daily oil production is 70,000 Barrels

�Daily gas production is 4.2 BCF

�Daily oil import is around one third of a million barrel

�Pakistan has a model energy mix from environmental point of view

�Leads South Asia in petroleum reforms

�Has Forward looking & dynamic policies to promote private investment

�Offers highly attractive gas prices in terms of 2012 Policy, Tight Gas Policy,Low BTU Gas Price Policy and Marginal / Stranded Gas fields - Gas Pricing Criteria and Guidelines, 2013

�Is competitive and profitable

�Has a ready market for oil & gas

�Has proven Geology and excellent prospectivity

Policy, Rules & Prospectivity

Present Situation

PELPELPAKISTAN PETROLEUM SECTOR

Dynamic Policies offeringcompetitive financial and

regulatory packages

Excellent success ratio of 1 to 3.3

Sedimentary basins are under explored (two wells /

1000 Km²)

Excellent prospects for discovering additional Oil &

Gas reserves

Country wide oil & gas infrastructure and ready

market for new discoveries

PELPAKISTAN PETROLEUM SECTOR

Exploratory Wells

Area under Exploration

Leases

Development Wells

Exploratory Drilling Density

Sedimentary Area

Exploration Licenses

OperatorsDiscoveries: 256

�820 (First well in 1866)

�274,641 km² (33% of sedimentary area)

�133

�1137

�2 wells / 1000 km²�very low compared to

the world’s average

�827,268 km²

�132

�18 Foreign and 11 Local Companies�Oil 60

�Gas/Condensate 196

PELTypes of Exploration & Production Rights

Reconnaissance Permit

Exploration Licence (Onshore)

Development & Production Lease (Onshore)

�Non-exclusive One year initial term with One year renewal for unlimited open area

�5 years initial term (Two phases) Phase-1 : 3 years Phase-2 : 2 years

�Two renewals of one year each

�One year appraisal period (All Zones) with 5 years additional retention allowed for gas market

�MaximumArea allowed : 2500 sq. km

� Relinquishment

�30% of the original area after Phase-I (after 3 years)

�20% of the remaining area after Phase-II (after 5 years)

�10% of the remaining area on or before 2nd renewal (after 6 years)

�25 years with one 5 year renewal


Exploration Licence (Offshore)

Total period of Licence : 7 years

Development & Production Lease (Offshore)

�5 years initial term (Two Phases)

�Two renewals of one year each allowed

�Maximum period of one year allowed for appraisal operations over discovery area plus additional 5

years retention period for gas market

�MaximumArea allowed : 2500 sq. km

�Relinquishment

�30% of the original area after Phase-I (after 3 years)

�30% of the remaining area after Phase-II (after 5 years)

�20% of the remaining area at the end of 1st renewal (after 6 years)

�25 years with one 5 year renewal


Grant of Lease after Expiry of Lease Term

�

agrees to pay an amount equivalent to 15% of the wellhead value to the Government

�DGPC will otherwise invite bids one year before the end of the lease period from pre-qualified

companies seeking to have a petroleum right over the lease area, in relation to any producing

field for an additional ten years.

�The bids will be evaluated on the basis of Signature Bonus

�Each bidder shall provide a bid bond of 10% of the offered Signature Bonus at the time of

bidding

�DGPC shall be under no obligation to grant any extension.

DGPC can renew the lease term for another five years term in case the existing lease holder

PELFinancial Terms

Crude Oil Pricing

Condensate Pricing

�Crude oil delivered at the nearest refinery shall

be equal to C&F price of a comparable crude

oil or a basket of Arabian/Persian Gulf crude

oils (Reference Crude or RC) plus or minus(±)

a quality differential between the RC and the

local crude oil.

�No other adjustment or discount will apply

other than the Windfall Levy.

�FOB price of internationally quoted

comparable condensate delivered at the

nearest refinery gate plus or minus (±) a

quality yield differential, based on the value in

the Arab Gulf spot products market of the

condensate.

�No other adjustment or discount will apply

other than Windfall Levy.

Windfall Levy:

WLO = 0.4 x (M-R) x (P-B)

Where:

WLO - Windfall Levy on crude oil and

condensate;

M - Net production (petroleum produced &

saved);

R - Royalty;

P - Market Price of crude oil and

condensate;

B - Base Price, which will be as under:

a. The base price for crude oil and

condensate will be USD 40 (USD 0.5/bbl per year

escalation).

In the event Market Price of Crude Oil/Condensate

exceeds US$ 110/barrel, the 100% benefit of

Windfall Levy will pass on to the Government. The

ceiling would be reviewed as and when pricing

dynamics significantly changes in the international

market.

PELFinancial Terms

Gas Pricing

Windfall Levy on Natural Gas:

�

basket of crude oil

�The floor set at US$ 10/bbl and ceiling at US$ 110/bbl

�Plus applicable discounts for Zones:

�Zone-0: 73.88% (Offshore Shallow)�Zone-0: 84.44% (Offshore Deep)�Zone-0: 95.00% (Offshore Ultra Deep)�Zone-I : 69.66% (Onshore)�Zone-II: 66.5% (Onshore)�Zone-III: 63.33% (Onshore)

rdWill only be applied if the sale is made to a 3 Party over and

above the policy price and there will be no Windfall Levy if the Natural Gas is sold to theGovernment of Pakistan

The multi-stage pricing mechanism with the addition of slabs up to US$ 110/bbl price of

US$/BBL Applicable % of C&F Price

0 to 30 100%

Above 30 to 50 Plus 50% of incremental increase



PELFinancial Terms

Gas Pricing - (Illustration)

$/BBL

A. Weighted average imported Crude Oil C & F Price (Assumed RCP) 140.00

Floor Price C & F 10.00

Ceiling Price 110.00

B. Apply sliding scale discounts to C&F crude oil price after floor & upto ceiling.

US$/BBL Applicable % of C&F Price US$/BBL

0 to 30 100% 30

Above 30 to 50 Plus 50% of incremental increase 10



Applicable C&F Price (A+B+C+D) 54

Marker Price Onshore Zone III 63.33% of applicable C&F price $34.2

Conversion Factor * assumed (MM Btu/bbl) 5.7

Zone III producer price for pipe line quality specification gas in US$/MMBtu 6

PELFinancial Terms

Extended Well Testing

Corporate Tax Rate

Royalty

Following Royalty schedule will be applied for offshore:

�

prince.

�ax on income will be payable at the rate of 40% of profit or gains in accordance with the Fifth Schedule of theIncome Tax Ordinance, 2001.

�Royalty will be payable at the rate of 12.5% of the value of petroleum at the field gate.

�First 48 Calendar Months after Commencement of Commercial Production (No Royalty)

�Months 49 to 60 inclusive (5% of field gate price)

�Calendar Months 61 to 72 inclusive (10% of field gate price)

�Calendar Months 73 and greater (12.5% of field gate price)

�It will be treated as an expense for the purpose of determination of income tax liability.

The discount during EWT phase – 5% for on spec gas & 10% for off spec gas on the applicable zonal gas

T

PELFinancial Terms

�Cost Limit (Under production sharing arrangement for offshore)

�Cost limit is 85% including the royalty of 12.5%. The Contractor can recover 100% of the costs up to a maximum of 85% of the gross revenues.

�Profit Oil and Profit Gas Splits1 Profit oil & gas share for wells in shallow grid area of less than 200m water depth and depth to

reservoir shallower than 4,000m

Cumulative Available Oil/ Government Holdings Share Contractor Share of ProfitAvailable Gas from Contract of Profit Oil/Profit Gas in Oil/Profit Gas in Contract

Area Contract Area Area

MMBOE Crude Oil/LPG/ Natural Gas Crude Oil/LPG/ Natural

Condensate Gas Condensate Gas

0-100 20% 10% 80% 90%

>100-200 25% 15% 75% 85%

>200-400 40% 35% 60% 65%

>400-800 60% 50% 40% 50%

>800-1200 70% 70% 30% 30%

>1200 80% 80% 20% 20%

PEL

Crude Oil/ LPG/

CondensateNatural Gas

Crude Oil/ LPG/


5% 5% 95% 95%

10% 10% 90% 90%

25% 25% 75% 75%

35% 35% 65% 65%

45% 45% 55% 55%

60% 60% 40% 40%

Government Holdings Share of

Profit Oil/Profit Gas in Contract

Area

Contractor Share of Profit

Oil/Profit Gas in Contract Area

MMBOE

0 - 300

>300 - 600

Cumulative Available

Oil/Available Gas from

Contract Area

>3600

>600 - 1200

>1200 - 2400

>2400 - 3600

Financial Terms

2. Profit oil & gas share for wells in deep grid area of more than or equal to 200m and less than

1,000m water depth or deeper than 4,000m to reservoir in shallow grid area

3. Profit oil & gas share for wells in ultra deep grid area of more than or equal to 1,000m water depth

Crude Oil/ LPG/


Crude Oil/ LPG/


5% 5% 95% 95%

10% 10% 90% 90%

25% 25% 75% 75%

35% 35% 65% 65%

50% 50% 50% 50%

70% 70% 30% 30%>2400

>400 - 800

>800 - 1200

>1200 - 2400

Government Holdings Share of

Profit Oil/Profit Gas in Contract

Area

Contractor Share of Profit

Oil/Profit Gas in Contract Area

MMBOE

0 - 200

>200 - 400

Cumulative Available

Oil/Available Gas from

Contract Area

PELSurface Area Rental Training Obligations:

Exploration

Lease

�Initial Term: Rs. 3,500 / sq.km or Rs. 800 / sq.km each year or part thereof

�Each Renewal: Rs. 5,000 / sq. km or Rs. 2,750 / sq. km each year

�Initial Term: Annually - Rs. 7,500 / sq. km �Renewal: Annually – Rs. 10,000 / sq.km

or part thereof

or part thereofor part thereof

Exploration

�USD 25,000/year - exploration phase (Onshore)

� USD 50,000/year - development and production (Onshore)

�USD 50,000/year - exploration phase (Offshore)

�USD 250,000/year - development and production (Offshore)

Cumulative Production Amount(MMBOE) (USD)

At start of commercial production 600,000

30 1,200,000

60 2,000,000

80 5,000,000

100 7,000,000

GOVERNMENT OBLIGATIONS

Social Welfare Production Bonus

a. During exploration stage USD 30,000 per Licence Yearuntil Commercial Production:

b. During Commercial Amount/Lease Year (USD) (For all Zones) Production Phase (BOE/d)

Less than 2,000 50,000 (Zones O & I); 37,500 (Zones II & III)

2,000 - 5,000 100,000 (Zones O & I); 75,000 (Zones II & III)



More than 50,000 700,000 (Zones O & I); 525,000 (Zones II & III)

PELCHAIRMAN & BOARD OF DIRECTORS

Mr.Chairman & Chief Executive

ZAHEERUDDIN

Mr.Director

ZAFAR IQBAL Mr.Director

MOEENUDDIN Mr. SHAHZAD ZAHEERDirector

Mr. SHAHBAZ ZAHEERDirector

PELRECOGNITION OF SERVICES

The Group’s founder Chairman, Mr. Zaheeruddin, has been bestowed upon a prestigious civil award, Tamgha-e-Imtiaz (Medal of Distinction), by the President of Pakistan,

in recognition of his outstanding services to the Oil, Gas and Power Sectors. The Award was given to him by the Governor of Punjab on behalf of the President of Pakistan

PELSENIOR MANAGEMENT

Dr. Gulfaraz AhmedChief Operating Officer

Mr. Edwin G Bowles SGM (London Office)

Mr. Khalid RahimGM Production & Planning

Mr. Tariq Fatemi Senior Executive Vice President

International Affairs

Mr. Munir AhmedAdvisor Technical

Dr. Mahmood-Ul-HassanSGM Exploration

Mr. Shahid AhmadAdvisor Concession & Corporate

Affairs / Head of Exploration

Mr. S. A. RehmanSenior General Manager

Operations

PELSENIOR MANAGEMENT

Mr.Shahid-Ul-KhairiGM Exploration

Brig. (R) M Saleem GM Co-ordination

Mr. Khawaja ManzoorGM Procurement

Mr. Mohammad JamilGM Drilling

Air Cdre (R) M.Yousaf JavedDGM Finance

Lt Col (R) Azhar IqbalManager HR and Admin

Mr. Azam MalikGM Exploration

Mr. M. Maroof GM Geophysics

Mr. Amir HameedGM Taxation

Dr. Rafiq ShaikhGeneral Manager

Process

TECHNICAL TEAM

Mr. Muhammad YousufManager Prospect Generation

Mr. Muzaffar Ali KhanManager Production

Mr. Naveed AkramGeneral Manager

Reservoir Management

Mr. Abdul Majeed AnwarGeneral Manager Special Projects

Mr. Haider Ali ShahManager Exploration

Mr. Amjad Waheed Qureshi Manager Geology

Ms. Farah ShafiqueSr. Geophysicist

Mr. Faisal SheikhSr. Geophysicist

PEL

PELFINANCE & COMMERCIAL TEAM

Mr. Talha Waheed

Mr. Ubaid Rehmat Mr. Shahzad Ashraf Miss Mehreen Mir Mr. Jawad Ahmed

Mr. Kamran Shuja Mr. Adeeb Ali Mirza Mr. Assad Saeed

Ms. Zainab Nayyar

PEL

Mr. Azhar-ul-IslamVice President Business Development

Syed Haider AbbasManager IT

Maj (R) Kamran ShahidAssistant Manager (Field Operations)

Col (R) Shujaat Ghumman Manager Training &

Social Welfare

Mr. Salman RashedBusiness Development

Consultant

Syed Azim SabirManager Graphics

PELGROWTH……

Established

Growth

Present Status

�PEL was established in 1994, by Mr. Zaheeruddin, who is the founding Chairman and Chief Executive

�In less than 18 years, PEL has grown into a highly reputable and successful E&P company

�It has the largest exploration acreage among indigenous private sector companies and is operating both within the country and abroad

�PEL has the distinction of being the first private petroleum company of Pakistan going abroad to the Kingdom of Morocco for exploration and development of oil & gas, as an Operator

PEL

Currently operates nine onshore and one offshore exploration licences, five D&P/Mining leases and one non-operated concession in Pakistan

Operating three onshore permits in the Kingdom of Morocco, as one of the pioneer Pakistani companies to enter the region, in partnership with ONHYM (the Moroccan National Petroleum Company)

Presently producing natural gas from four gas fields

Recently production has commenced from Koonj gas discovery in Sukkur Block operated by Mari Petroleum Company. PEL has 41.2% working interest in this Block

The company along with its joint-venture partners has invested over US$ 200 Million in the past and plans to invest over US $ 300 Million on exploration and production during the next two years

GROWTH

PELJOINT VENTURE PARTNERS

Oil & Gas Development Company Ltd, Pakistan

Government Holdings Private Limited, Pakistan

Pakistan Petroleum Limited, Pakistan

Mari Petroleum Company Limited, Pakistan

Oil & Gas Investments, Pakistan

Pyramid Energy International Incorporated, Canada

Frontier Holdings Limited, Canada

RONTIER HOLDINGS LIMITEDA SUBSIDIARY OF JURA ENERGY CORP

Gulf Petroleum Exploration International, Kuwait

GPX

Sherritt International Oil & Gas Limited, Canada

sherritt

Spud Energy Private Limited, Australia

Spud Energy (Pty) Ltd

BP Exploration (Alpha) limited

Office National des Hydrocarbures et des Mines, Morocco

ONHYMONHYM

The range and diversity of Company’s reputable Joint Venture Partners reflect their

confidence in the ability and competence in PEL as an Operator

MPCL

PELMISSION & VISION

To effectively participate in petroleum exploration and production by spreading the risk andsharing the reward and enhancing knowledge base through alliances and joint ventures with keyE&P companies nationally and internationally

To develop a sound professional base with cutting edge technology and knowledge to emerge asa global E&P player

To maximize returns to all the joint venture partners and contribute to the economy of the country

To protect and preserve environment in all its operations

To enhance reserve base and production level through diligent exploration, acquisition and rapiddevelopment of available resources

To look for joint ventures/mergers/acquisitions and strategic alliances/networking with other E&Pcompanies

PELOIL & GAS PROVINCES OF PAKISTAN

GENERALIZED TECTONIC MAP - PAKISTAN

PELPROSPECTIVITY ZONE MAP

PELEXPLORATION & PRODUCTION PORTFOLIO

Exploration Licences (Onshore)

�Mirpur Mathelo �New Larkana �Badin IV South�Mirpur Khas West�Kaloi�Sukkur (Non-Operated)

�Salam�Badin IV North �Jhangara�Sanghar East�Hamza Discovery (Applied for Commerciality)

Exploration Licences (Offshore)�Offshore Indus – J

Exploration Permits Morocco (Onshore)

�Haha-1�Haha-2�Haha-3

Development and Production / Mining Leases

�Hasan Hasan D&PL�Khanpur D&PL�Badar ML

�Sadiq D&PL�Kandra D&PL

PELEXPLORATION PORTFOLIO (PAKISTAN)

Exploration Licences in

PakistanWIOs Area (km²)

Mirpur Mathelo (2769-9)PEL (Operator) 35 %

FHL 35 %, GPX 25%, GHPL 5 % (Carried) *1,030.68

Salam (2769-13) PEL (Operator) 37.5%, FHL 37.5%, GPX 25% * 200.22

New Larkana (2768-10) PEL 100 % 2,425.96

Badin IV North ( 2468-6) PEL (Operator) 47.5% , FHL 27.5%, GPX 25% 1,246.03

Badin IV South (2468-5) PEL (Operator) 47.5%, FHL 27.5%, GPX 25% 1,265.33

Offshore Indus-J (2266-4) PEL (Operator) 67%, BP 33% (under assignment to PEL ) 2,436.30

Jhangara (2567-5) PEL (Operator) 40%, OGIL 60% 357.19

Mirpur Khas West (2568-16) PEL 100 % 199.26

Sanghar East (2669-5) PEL 100 % 2,493.13

Kaloi (2468-8) PEL 100 % 2,485.14

* GPX and FHL have given notice for assignment of their interest to PEL

PELMIRPUR MATHELO BLOCK

Middle Indus basin2

Area: 1030.68 kmLocation: Sukkur and Ghotki Districts, Sindh ProvinceWorking Interest: PEL 35% (Operator), FHL 35%, GPX 25%,

GHPL (carried) 5% Play types: Structural/stratigraphic in Sui Main Limestone

(Eocene), Lower Goru (K)Hydrocarbon play: Gas/condensateProspectivity Zone: IIISurrounding oil & gas fields: Mari(8.2 TCF), Qadirpur(5.5 TCF), Rehmat (114

BCF) and Badar(100 BCF)Reserves exposure: Over 2 TCF

*

Work commitment

Work completed:

Work in progress

:

50 & 150 lkm 2D seismic and 1 exploratory well

Seismic acquired: 253 lkm 2D

Seismic purchased: 2060 lkm 2D

Seismic processed/reprocessed: 1716 lkm 2D

Well data purchased: 2 wells

Leads/prospects mapped: 5

Exploratory wells drilled: 1

Reservoir evaluation through seismic inversion interpretation

Remaining Work Commitment: 150 line km 2D seismic

:

Stratigraphic play interpretation

Structural/stratigraphic/reservoir play modeling

G & G in progress

Mari

8.2 TCF

Qadirpur

5.5 TCF

Badar

100 BCF Rehmat

114 BCF

Miano

537 BCF

Kandra

2.86TCF

175 TCF

Haseeb

200 BCF

Mr

ur Mhel

o

i p

at


PELPELMiddle Indus Basin

2Area: 200.22 kmLocation: Jacobabad and Ghotki Districts, Sindh ProvinceWorking Interest: PEL 37.5 % (Operator), FHL 37.5 %, GPX 25 %Play types: Structural in Sui Main Limestone (Eocene)Hydrocarbon play: GasProspectivity Zone: IIISurrounding oil & gas fields: Qadirpur (5.5 TCF), Kandhkot (1.6 TCF) and

Badar (100 BCF)Reserves exposure: 400 BCF

*

Work Commitment:

Work completed:

Work in progress:

30 lkm 2D seismic and 1 exploratory well

Seismic acquired: 134 lkm 2DSeismic data purchased: 520 lkm 2DSeismic data processed/reprocessed: 654 lkm 2DWell data purchased: 3Leads/prospects mapped: 2Reservoir evaluation through seismic inversion interpretation

In house G & G studiesStructural/stratigraphic/reservoir play modelingPreparations in hand to drill an exploratory well

SALAM BLOCK

Qadirpur5.5 TCF

Haseeb200 BCF Mari

8.2 TCF

Kandra2.86 TCF

175 TCF

Badar100 BCF

Rehmat114 BCF

Miano537 BCF

Khandkot1.6 TCF


PELBADIN- IV NORTH BLOCK

Lower Indus Basin2

Area: 1246.03 kmLocation: Hyderabad and Thatta districts, Sindh provinceWorking Interest: PEL 47.5 % (Operator), FHL 27.5 %, GPX 25 %Play Types: Tilted fault blocks, structural/stratigraphic in

Lower Goru, Sembar sands (Cretaceous) and Chiltan carbonates (Jurassic)

Hydrocarbon play: Oil, Gas & CondensateProspectivity Zone: IIISurrounding oil & gas fields: The surrounding oil and gas fields operated by

UEPL (formerly UTP/BP) have already produced over 185 MMBO and 1.5 TCF gas

Reserves Exposure: 25 MMBO & 200 BCF

Work commitment:

Work completed

Work in progress:

150 lkm 2D seismic & 3 exploratory wells

Seismic acquired: 300 lkm 2D seismic 2

Seismic data purchased: 4493 lkm 2D & 993 km 3DSeismic data processed/reprocessed: 1460 lkm 2DWell data purchased: 41Leads/prospects mapped: 14Exploratory wells drilled: 2

In-house G & G studies to upgrade the leads to prospect level.Vintage seismic interpretation to delineate stratigraphic trapsRe-Processing of one line through Hajirah Prospects is in hand.

BADIN IV NORTH

PELBADIN – IV SOUTH BLOCK

Lower Indus Basin2

Area: 1265.33 kmLocation: Thatta and Badin Districts, Sindh ProvinceWorking Interest: PEL 47.5 %(Operator), FHL 27.5 %, GPX 25 %Play Types: Tilted fault blocks, structural/stratigraphic in

Lower Goru, Sembar sands (Cretaceous) and Chiltan carbonates (Jurassic)

Hydrocarbon play: Oil, Gas & CondensateProspectivity Zone: IIISurrounding oil & gas fields: The surrounding oil and gas fields operated by

UEPL (formerly UTP/BP) have already produced over 185 MMBO and 1.5 TCF gas

Reserves Exposure: 30 MMBO & 700 BCF

Work commitment:

Work completed

Work in progress:

100 lkm 2D seismic & 4 exploratory wells

Seismic acquired: 483 lkm 2D seismic 2

Seismic data purchased: 2673 lkm 2D & 626 km 3DSeismic data processed/reprocessed: 2322 lkm 2DWell data purchased: 29 Leads/prospects mapped: 10

In-house G & G studiesVintage seismic interpretation to delineate stratigraphic trapsPreparing to drill two exploratory wells back to back.

PELJHANGARA BLOCK

Lower Indus Basin2

Area: 357.19 kmLocation: Dadu District, Sindh ProvinceWorking Interest: PEL 40% (Operator),OGIL 60%Play types: Structural & stratigraphic in Cretaceous sandsHydrocarbon play: Gas/ condensateProspectivity Zone: IIISurrounding oil & gas fields: Zamzama (2.32 TCF + 11.68 MMBC) & Bhit

(1.6 TCF) producing from Pab and Badhra (500 BCF) producing from Mughal Kot

Reserves Exposure: 350 BCF

Work commitment:

Work completed:

Work in progress:

200 lkm 2D seismic acquisition

Seismic data purchased: 253 lkm 2DProspects mapped: 2Exploratory wells drilled: 1Structural modeling through Beicip FranlabGeological field work mapping and outcrop samplingStructural and reservoir evaluation studyPetrophysical analysis of Pab and Mughal Kot intervals

In-house G&G studiesStructural/stratigraphic/reservoir play modelingPreparations are in hand to carry out s geological field study before acquiringseismic and drilling of an exploratory well.

Zamzama 2.32 TCF &11.68 MMBC

Bhit1.6 TCF

Badhra110 BCF

UEPL (formallyUTP/BP), OGDCL & PPL

operated fields

PELKALOI BLOCK

Lower Indus Basin2

Area: 2485.14 kmLocation: Badin and Mithi Districts, Sindh Province Working interest: PEL (Operator)100% Play types: Tilted fault blocks & stratigraphic in Lower

Goru and Sembar sands (K) and Chiltan carbonates (J)

Hydrocarbon play: Oil, gas/condensateProspectivity Zone: IIISurrounding oil & gas fields: The surrounding oil and gas fields operated by

UEPL (formerly UTP/BP), located to the west, have already produced over 185 MMBO and 1.5 TCF gas

Reserves exposure: 15 MMBO & 350 BCF

Work commitment

Work completed:

Work in progress

:300 lkm 2D seismic and 2 exploratory wells

2D seismic purchased: 506 lkm 2DLeads/prospects mapped: 4

Vintage data interpretation at Lower Goru Basal sandStructural/stratigraphic/ reservoir play modelingWork in progress on evaluation of petroleum system in the BlockU

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PELMIRPUR KHAS WEST BLOCK

Lower Indus Basin2

Area: 199.26 kmLocation: Hyderabad & Dadu Districts, Sindh ProvinceWorking Interest: PEL (Operator) 100 % Play Types: Tilted fault blocks, structural/stratigraphic in

Lower Goru sands (Cretaceous) and Chiltan carbonates (Jurassic)

Hydrocarbon play: GasProspectivity Zone: IIISurrounding oil & gas fields: OGDCL, PPL and UEPL (formerly UTP/BP) oil,

gas/condensate fields are located north of Badin Blocks that have already produced 83 MMBO and 337 BCF gas

Reserve Exposure: 200BCF

Work commitment:

Work completed:

Work in progress

250 lkm 2D seismic and 3 exploratory wells

Seismic acquired: 176 lkm 2DSeismic purchased: 305 lkm 2DSeismic processed/reprocessed: 276 lkm 2DWell data purchased: 8Leads/prospects mapped: 3

In-house G&G studiesSequence stratigraphy evaluation of L. Goru sandsStructural/stratigraphic/reservoir play modelingPreparations to drill an exploratory well

UEPL(formallyUTP/BP)operated

fields

UEPL (formallyUTP/BP)

OGDCL & PPLoperated fields

PELSANGHAR EAST BLOCK

Lower Indus Basin2

Area: 2493.13 kmLocation: Sanghar and Khairpur Districts Sindh

ProvinceWorking interest: PEL (Operator) 100 %Play types: Structural/stratigraphic in Lower Goru,

Sembar (Cretaceous) sands & Jurassic carbonates

Hydrocarbon play: Oil/gasProspectivity Zone: IIISurrounding oil & gas fields: SGL Gas Field, Rajasthan, India (Focus

Energy) and Lala Jamali, Sindh (OGDCL)Reserves exposure: 200 BCF

Work Commitment:

Work Completed:

Work in Progress:


Seismic purchased: 685 lkm 2DSeismic reprocessed: 36 lkm 2DWell Data Purchased: 2 wellsLeads/prospects mapped: 2

Vintage seismic interpretationStructural/stratigraphic/reservoir play modelingWork in progress on evaluation of petroleum system in the Block

UEPL (formallyUTP/BP)

OGDCL & PPLoperated fields

Lala Jamali Gas Field(OGDCL), in L. Goru,

flowed 1130 btu/scf gas

SGL Gas Field 3100min L. Goru, flowed 31 MMSFD,

about 950btu/scf gas

PELNEW LARKANA BLOCK

Lower Indus Basin2

Area: 2425.96 kmLocation: Larkana & Shikarpur Districts, Sindh Province Working interest: PEL (Operator)100 % Play types: Structural in Sui Main Limestone (Eocene),

Dunghan carbonates (Paleocene)and stratigraphic in Pab Sandstone (Cretaceous)

Hydrocarbon play: Gas/condensateProspectivity Zone: IIISurrounding oil & gas fields: Mehar (434 BCF), Mazarani (183 BCF), Haseeb

(200 BCF), Kandra (2.86 TCF), Block 22 (175 BCF)

Reserves exposure: 200 BCF

Work commitment:

Work completed:

Work in progress:


Seismic data purchased: 556 lkm 2DWell data purchased: 1Leads/prospects mapped: 2

In-house G & G studiesStructural/stratigraphic/reservoir play modelingPreparing to acquire 2D seismic before drilling a well

Hasan, Khanpur,Sadiq & Hamza

175 BCF

Kandra2.86 TCF

Haseeb200 BCF

Mazarai183 BCF

Mehar434 BCF

PEL

SUKKUR BLOCK (NON-OPERATED)

Middle Indus Basin2

Area: 2435.4 kmLocation: Sukkur and Ghotki Districts, Sindh ProvinceWorking Interest: PEL 41.2%, MPCL (Operator) 58.8%Play types: Structural in Sui Upper & Sui Main Limestones

(Eocene) and stratigraphic in Lower Goru sands (Cretaceous)

Hydrocarbon play: Gas/condensateProspectivity Zone: IIISurrounding oil & gas fields: Block 22 (175 BCF), Haseeb (200 BCF), Kandra

(2.86 TCF), Rehmat (114 BCF) and Badar 100 BCF

Reserves exposure: 200 – 300 BCFWork commitment:

Work completed

Work in progress:

Seismic Acquisition & Processing of100 lkms and 3 exploratory wells

Seismic acquired: 460 lkmSeismic data purchased: 909 lkm 2DSeismic data processed/reprocessed: 1200 lkmWell data purchased: 5Leads/prospects mapped: 5Wells drilled: 3Discovered Koonj Gas Field, which is under extended well testing (EWT). Present production 2 MMSCFDRegional geological study of Central Indus Basin

In-house G & G studiesVintage seismic interpretationStructural/stratigraphic/reservoir play modelingPlanning to undertake sequence strat study

Mari8.2 TCF

175 BCF Khandkot1.6 TCFHaseeb

200 BCF

Qadirpur5.5 TCF

Badar100 BCF

Miano537 BCFKandra

2.86 TCF

Rehmat114 BCF

PELOFFSHORE INDUS – J BLOCK

Offshore Indus Basin2

Area: 2436.30 kmLocation: 200 km south of KarachiWorking Interest: PEL (Operator) 67 %, BP 33% (under assignment to

PEL)Play types: Channel/levee sands/carbonate buildups (Paleogene –

Neogene)Hydrocarbon play: Gas/condensateProspectivity Zone: OWells in the area: 13 wells (PakCan-1 flowed 3.7 MMSCFD)Reserves exposure: 25 - 30 TCF

Work commitment

Work completed:

Work in progress:

:186 Work Units (WU) One WU = 10 lkm 2D or 1 km² 3D seismic

Seismic acquired: 936.5 lkm 2D& 550 km² 3D (643.6 WU)

Seismic processed to PSDM level: 550 km² 3D cubeLeads/prospects mapped: 2 on 3D cube and 3 on 2D data

In-house G & G studiesStructural/stratigraphic/reservoir and source play modelingA study covering reservoir characterization and pore pressures as well as economics is proposed to be assigned to CGG

PEL

OIL AND GAS POTENTIAL EXPLORATORY BLOCKS (PAKISTAN)

Mirpur Khas West

0.20 TCF

Jhangara

0.35 TCF

Salam

0.40 TCF

New Larkana

0.20 TCF

Badin IV North

0.20 TCF

Badin IV South

0.70 TCF

Sanghar East

0.20 TCF

Kaloi

0.35 TCF

Badin IV North

25 MMBBL

Badin IV South

30 MMBBL

Kaloi

15 MMBBL

Reserve Exposure for Offshore J Block is estimated at 25 – 30 TCF

PELRecoverable Reserves (Operated Fields)

Recoverable reserves from Block-22, Badar and Kandra Fields are estimated to be over 3 TCF of Gas

PEL

Gas Production Share 2011 – 2012

POL

0.53%

OGDCL

21.38%

Dewan

0.71%

OMV

11.00%

OPII

0.33%MOL

7.57%

PEL

0.67%

PetronasEni Pakistan

11.86%

TULLOW

0.01%

PPL

18.86%

BHP

9.73%

BP

4.39%

MGCL

12.65%

0.33%

PELGas Production Share 2011 – 2012

(Private Sector, Pakistan)

PEL

35.05%

Dewan

37.26%POL

27.69%

PELHASSAN, SADIQ & KHANPUR D & P LEASES

Hasan D & P Lease

Khanpur D & P Lease

Sadiq D & P Lease

Gas Production 7.702 MMSCFD (Jan 2013)

PELHASSAN, SADIQ & KHANPUR D & P LEASES…

Block – 22 Fields on production since December 2000

Reservoir:

Cumulative production:

Number of producing wells:

Hasan-4 well to be drilled in 2013

Sui Main Limestone(SML) Eocene

61.82 BCF (as on 31-01-2013)

06

PELHASSAN, SADIQ & KHANPUR D & P LEASES…

�Block-22 was awarded in 1994

�Four discoveries namely Hasan, Sadiq, Khanpur & Hamza have

been made

�Three D&P Leases have been granted whereas the Hamza DOC has

been submitted to DGPC for approval

�Production Facilities consist of Dehydration Unit, Amine sweetening

unit, Compressors, API separator, Evaporator and Condensate

handling unit.

�Plan to drill an additional well in Hasan Lease to enhance production

PELBADAR MINING LEASE

Badar Mining Lease was granted in 2002, GSA was

signed inAugust, 2004 and production from the field

commenced from SMLreservoir inApril, 2006.

Current production rate is 13.62 MMSCFD.

Cumulative production from the date of first gas

delivery is 37.21 BCF (as on 31-01-2013).

The field is surrounded by major gas fields and has

an upside potential of stratigraphic and structural

plays

Badar-2 development well will be drilled in 2013 to

enhance production. Efforts are in hand to find a

suitable rig.

Badar 13.62MMSCFD

PELKANDRA D&PL

Lease Granted

Location/Area

Objectives

Recoverable Reserves

Wells Drilled

Power Project

Future Plan

January 2006

Khairpur and Sukkur Districts/314.43 Km²

Primary –SML (Eocene)

Secondary – Lower Goru Sands / Chiltan

Limestone

2.86 TCF (SML)

3 shallow, 1 deep

GOP approved 120 MW power plant using

Kandra Gas as fuel

Preparations in hand to develop the field

PELKANDRA FIELD DEVELOPMENT & POWER PROJECT

The field development and power project is estimated to cost about

US $ 95 million and US $ 165 million respectively

FIELD DEVELOPMENT

POWER PROJECT

�The low heating value Kandra gas (150 BTU/SCF) will be used as fuel for

power generation after processing and blending with pipeline quality gas

�The field development envisages drilling and completing 12-14 additional

wells, surface gathering lines and central processing facility for producing

120 MMSCFD of raw gas

�This gas, after processing, will yield 40 MMSCFD gas of 330 BTU/SCF

heating value

�The processed Kandra gas will be commingled with 10 MMSCFD pipeline

quality gas of 900-950 BTU/SCF heating value to yield 50 MMSCFD of +430

SCF heating value

�This gas will be used as fuel for Combined Cycle Power Project of 120

megawatts electricity to be set up by the Kandra Power Company.

PEL

EXPLORING AFRICA - KINGDOM OF MOROCCO

PEL

Essaouira Basin2

Area: 4919 km (about 25% of Essaouira Basin) Location: 550 km southwest of Capital RabatWorking interest: PEL75% (operator), ONHYM (carried) 25%Play types: Structural/stratigraphic in Triassic sands, Jurassic

sands/carbonates and Paleozoic clastics Hydrocarbon play: Gas, oil and condensateSurrounding oil & gas fields: Seven oil and gas fields about 60 km to the north

with estimated reserves of 500 BCF and 50 MMB oil/ condensate in Triassic & Jurassic sands and carbonates. Sidi Rhalem oil field produced 9 MMBBL of oil from Jurassic Carbonates

Resource exposure: 8 TCF and 400MMBBL

Work commitment:

Work completed:

Work in progress:

70 km² 3D and 1 well

Seismic acquired: 139 km² 3D Seismic data reprocessed: 132 lkm 2DLeads/prospects mapped: 04Salt induced surface structures

2delineated , 40-80 km each: 10Petrographic study of Triassic reservoirsGeochemical modelingGravity magnetic data evaluation

In-house G & G studiesEvaluation of salt cored structuresPreparing to drill an exploratory well

HAHA PERMITS MOROCCO

PEL

REGULATORY REGIME

�Politically stable & progressive country

�Investment friendly fiscal regime

�Government carried interest is limited to 25% in

exploration phase

�Royalty 10% on oil and 5% on gas

�No surface rental levied

�No petroleum duty

�No currency control

�Tax free import of equipment, material and

consumables

�Corporate Tax holiday during ten years regular

production


PEL

Large salt induced anticlines mapped indicating potential gas reserves of several TCF


PEL

NoSURFACE

STRUCTURES

EXPOSED

STRATARESERVOIR TARGETS

AREA

(km2)

1 Amsittene diapir Jurassic Triassic/Paleozoic 80

2 Ihchech Jurassic Triassic/Paleozoic 56

3 Ihchech south Jurassic Triassic/Paleozoic 70

4 Baulanouar Cretaceous Jurassic/Triassic/Paleozoic 60

5 Agouti Cretaceous Jurassic/Triassic/Paleozoic 30

6 Imakherim Cretaceous Jurassic/Triassic/Paleozoic 15

7 Adar yssi Cretaceous Jurassic/Triassic/Paleozoic 55

8 Assaka Cretaceous Jurassic/Triassic/Paleozoic 15

9 Aziar Cretaceous Jurassic/Triassic/Paleozoic 40

10 Imouzzer Triassic Paleozoic 48

HAHA PERMITS MOROCCO - SURFACE STRUCTURE

PELCORPORATE SOCIAL RESPONSIBILITY

CSR is a key priority for the Company

PELCORPORATE SOCIAL RESPONSIBILITY

Education

Drinking Water Disaster ManagementDisaster Management Road Infrastructure

Vocational Training Health

PEL

CORPORATE SOCIAL RESPONSIBILITY (Message from the Chairman)

As a responsible corporate entity, PEL is committed toenhancing the well being of the underprivileged communitiesin and around its concessions and lease areas, by providingclean drinking water, education, health facilities, localemployment and infrastructure development. Every yearmillions of dollars are being spent on community welfareprograms.

It gives me great pleasure to confirm that PEL hassucceeded in improving the well being of the communities living in around ourconcessions in addition to providing them health and educational facilities. PELis committed to continuing these efforts into the future

ZaheeruddinChairman and Chief Executive

PEL

As per the CSR policy outlined by the Chairman, PEL as aresponsible corporate entity is fully aware and committed to its

social responsibility towards the local communities in its area of operation

PEL as per its CSR Policy has established a track record ofimplementing social welfare schemes

PEL made a significant contribution (US$ 29,750) in constructionof eight classrooms at HMB Trust’s Institute of Science &

Technology, Shikarpur, Sindh

Provided funds for the establishment of Petroleum TrainingInstitute in Khairpur, Sindh

PEL undertook installation of Electric Water Coolers at variousschools, colleges, libraries and parks at a cost of US$ 33,688

PEL made a major contribution (US$ 456,260) in theestablishment of regional Petroleum Technical Training Institute

at Khairpur, Sindh

CORPORATE SOCIAL RESPONSIBILITY

PEL

CORPORATE SOCIAL RESPONSIBILITY…(RECENT SOCIAL WORK ACTIVITIES)

PEL has provided a training opportunity to the locals to participate in Oil & Gas Sector

PEL


Provision of uniforms for orphan children at Bait ul Mal Pakistan

PEL


Provision of medical facilities such as mobile dispensaries/ambulances for emergencies

PEL

Corporate Social Responsibility…(Recent social work activities)

Donated a vehicle to a well reputed NGO

PEL

CORPORATE SOCIAL RESPONSIBILITY…FLOOD RELIEF OPERATIONS

Unprecedented and devastating floods hit the entire country in the monsoon months of July and

August, 2010. People living in the vicinity of Block-22 & Badar fields were seriously affected by these

floods. PEL in line with its CSR Policy provided relief to the flood affectees by taking the following

actions:

�supplying cooked meals

�ration and other necessities like kitchen utensils

�boats for rescue works (one wooden boat and one fiber glass motor boat with 25HP engine)

�Organized distribution schemes of emergency food packs and relief goods (cooked meals

and bags (20 kg each) containing flour, rice, sugar, grain seed, cooking oil, milk and tea)

PEL also organized field trips of qualified medical teams through mobile dispensaries for helping the

affected people against exposure to water borne and other diseases.

PELCORPORATE SOCIAL RESPONSIBILITY…

TRAINING POLICY

PEL is committed to imparting skills related to oil & gas industry requirements. It has proudly invested over One

Million US Dollars during the last four years (i.e. 2008 – 2011) on training and development.

The main objective of training and development is to help develop key competencies that enable individuals to

perform their jobs successfully.All training and development programs are geared towards:

�Strengthening the job skills / knowledge

�Improving operational efficiency and productivity

Key TrainingActivities attended by our employees during 2011 are as follows:

�Oil & Gas Summit,Asia – Malaysia

�Seminar on Testing Through New Technology arranged by Schlumberger – Islamabad, Pakistan

�Procurement & Inventory Management arranged by Skill Development Council

�Wireline Log Interpretation arranged by OGTI – Islamabad, Pakistan

�Business Writing Skills arranged by Skill Development Council

PELSTATUTORY PAYMENTS TO THE GOVERNMENT

PEL has contributed an amount of over US$14.5 million from July, 2003 till July 2012 on account of statutory payments to theGovernment of Pakistan covering royalty,area rental, marine research, productionbonus, signature bonus, training, socialwelfare, general sales tax, excise duty, with-holding tax and custom duty.

PELHEALTH, SAFETY, SECURITY & ENVIRONMENT POLICY

Provide adequate training, information and instructions on health,

safety and hazardsEnsure protection of the

environment

Follow and maintain safe systems of work

To candidly audit and report all HSSE performances

Provide adequate and proper facilities,

equipment and safety

Commit towards a safe environmentalmanagement

Regard all accidents as preventable.

PELFUTURE OUTLOOK…

To exploit knowledge and evolving technology and pursueinternational opportunities for exploration and acquisition of

producing assets to become a leading E&P company

To attract serious E&P companies into Joint Venture Partnershipsin its exploration and production assets in Pakistan and overseas,

especially Morocco

To aim at an aggressive corporate growth through prudent goaloriented strategies and risk management by spreading the risks

and sharing the rewards

PELEXPECTED EXPONENTIAL RISE

Growth within Pakistan

Expansion of PELoperations

internationally

Achievingsustainability, and

making PEL a successful global energy company

PETROLEUM EXPLORATION (PVT) LTD.

PEL

20, Margalla Road, Sector F-8/3,Islamabad, Pakistan

Phones: Tel: 92-51-2287170-74 (5 lines) Fax: 92-51-2287154-55 (2 Lines)

Corporate Head Office

Finance & Marketing Division Technica l Off ices

E-Mail: [email protected], [email protected] &

Web: www.shahzadintl.com.pk

[email protected]

15, Nazimuddin Road, Sector F-10/4, Islamabad, Pakistan

Phones: 92-51-2299031- 36 (6 Lines) Fax: 92-51-2299028

66, Street 25, Sector F-10/1, Islamabad, Pakistan

Phone 92-51-2103247-9 (3 Lines) Fax: 92-51-2104573

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