Strategic Plan Of OGDCL

Oil and Gas development Company

Company History

Establishment of OGDC
To revive exploration in the energy sector the Government of Pakistan signed a long-term loan
Agreement on 04 March 1961 with the USSR, whereby Pakistan received 27 million Rubles to
finance equipment and services of Soviet experts for exploration. Pursuant to the Agreement,
OGDC was created under an Ordinance dated 20th September 1961. The Corporation was
charged with responsibility to undertake a well thought out and systematic exploratory
programme and to plan and promote Pakistan's oil and gas prospects.
As an instrument of policy in the oil and gas sector, the Corporation followed the Government
instructions in matters of exploration and development. The day to day management was
however, vested in a five-member Board of Directors appointed by the Government. In the initial
stages the financial resources were arranged by the GOP as the OGDC lacked the ways and
means to raise the risk capital. The first 10 to 15 years were devoted to development of
manpower and building of infrastructure to undertake much larger exploration programmes.
Initial Successes
A number of donor agencies such as the World Bank, Canadian International Development
Agency (CIDA) and the Asian Development Bank provided the impetus through assistance for
major development projects in the form of loans and grants. OGDC's concerted efforts were very
successful as they resulted in a number of major oil and gas discoveries between 1968 and 1982.
Toot oil field was discovered in 1968 which paved the way for further exploratory work in the
North. During the period 1970-75, the Company reformed the strategy for updating its
equipment base and undertook a very aggressive work programme. This resulted in discovery of
a number of oil and gas fields in the Eighties, thus giving the Company a measure of financial
independence. These include the Thora, Sono, Lashari, Bobi, Tando Alam & Dhodak
oil/condensate fields and Pirkoh, Uch, Loti, Nandpur and Panjpir gas fields which are
commercial discoveries that testify to the professional capabilities of the Corporation.
Transition to a self financing entity
Noting the Company's success, due to major oil and gas discoveries in the eighties, the
Government in July 1989, off-loaded the Company from the Federal .The financial year 1989-90,
was OGDC's first year of self-financing. It was a great challenge for OGDC. The obvious initial
target during the first year of self-financing was to generate sufficient resources to maintain the
momentum of exploration and development at a pace envisaged in the Public Sector
Development Programme (PSDP) as well as to meet its debt servicing obligations. OGDC not

only generated enough internal funds to meet its debt obligations but also invested enough
resources in exploration and development to increase the country's reserves and production.
Conversion into Public Limited Company
Prior to 23 October 1997, OGDCL was a statutory Corporation, and was known as OGDC (Oil
& Gas Development Corporation). It has been incorporated as a Public Limited Company w.e.f.
23 October 1997 and is now known as OGDCL (Oil & Gas Development Company Ltd.).

Initial Public Offering

Government of Pakistan disinvested part of its shareholding in the company in 2003. Initially
2.5% of the equity with an additional green-shoe option upto 2.5% of equity was offered to the
general public. The said Offer received an overwhelming response from the general public and
was recorded as a landmark transaction in the history of Pakistans capital markets.
GDR
In December 2006, the Government of Pakistan divested a further 10% of its holding in the
company. The Company is now listed on the London Stock Exchange since on December 06,
2006.

OGDCL Vision
To be a leading multinational Exploration and Production Company.

OGDCL Mission
To become the leading provider of oil and gas to the country by increasing exploration and
production both domestically and internationally, utilizing all options including strategic
alliances.
To continuously realign ourselves to meet the expectations of our stakeholders through best
management practices, the use of latest technology, and innovation for sustainable growth, while
being socially responsible.

Business strategy
As the leading exploration and production company in Pakistan, OGDCLs primary objective is
to enhance its reserves and production profile and ultimately maximize value for shareholders.
In order to achieve this goal, the Company seeks to execute the following strategies:

Accelerate Production Growth: by continuing to accelerate production growth through

utilizing cutting edge technologies, allowing the Company to utilize its significant reserves
base and capitalize on the strong economic growth and accelerating energy demand in
Pakistan.
Exploit Exploration Opportunities: by building the Companys future reserves portfolio
through its large onshore exploration acreage. During the fiscal year 2008-09 target of
drilling is 52 wells.
Maintain Low Cost Operations: OGDCLs operating environment, namely the
geographic concentration of its reserves base within Pakistan, will be a major factor in
allowing it to control its low cost structure. Within Pakistan, the Companys leading
position also enables it to access economies of scale across its significant reserves base and
operations.
Pursue Selective International Expansion: while domestic expansion remains OGDCLs
core focus, the Company intends to grow and diversify its portfolio through selective
international expansion in the medium to long-term.
Implementing International Best Practice: by ensuring an efficient organizational
structure and business processes that are focused on core production. As part of our
restructuring plan, OGDCL has established an in-house technical services division, the
Petroserv Directorate, which separates technical support services from core E&P activities.

OGDCL Goals & Core Values

Core Values
Merit
Integrity
Team Work
Safety
Dedication
Innovation

Goals
Financial

Build strategic reserves for future growth/expansion

Growth and superior returns to all stakeholders
Double the value of the company in the next five years.
Make investment decisions by ranking projects on the basis of best economic indicators
Maximize profits by investing surplus funds in profitable avenues
Reduce cost and time overruns to improve performance results.

Customers

Continuously improve quality of service and responsiveness to maintain a satisfied

customer base.
Improve reliability and efficiency of supply to the customer
Be a responsible corporate citizen

Learning & growth

Motivate our work force, and enhance their technical, managerial and business skills
through modern HR practices.
Acquire, learn and apply state-of-the-art technology.
Emphasize organizational learning and research through effective use of knowledge
management systems.
Fill the competency gap within the organization by attracting and retaining best
professionals.
Attain full autonomy in financial and decision making matters.

Internal Processing Goals

Evolve consensus through consultative process inter-linking activities of all departments

Excel in exploration, development and commercialization
Be transparent in all business transactions
Synergize through effective business practices and teamwork
Have well-defined SOPs with specific ownerships and accountabilities
Improve internal business decision making and strategic planning through state-of-the-art
MIS
Improve internal controls
Periodic business process reengineering.