KARACHI - The well drilling business outperformed during FY09 as the total number of wells in Pakistan increased to 86 during the period under review as compared to past 5-year average of 64 wells. According to the data gathered from Pakistan Petroleum Information Service (PPIS), total of 90 wells including 40 exploratory and 50 appraisal/ development wells were planned for FY09. Of the 86 wells drilled in FY09, 27 were exploration wells and 59 were appraisal/ development wells. This shows that the E&Ps were more inclined towards development activities than the fresh exploration. OGDC led the industry and spuded 30 wells (12 exploratory and 18 development) in FY09. The companys target for FY09 was 29 wells (14 exploratory and 15 development). Out of the 27 wells spuded in FY09, one was successful. The success ratio in FY09 arrived at a mere 4 percent (1 discovery out of 27 wells) compared to past 5-year average of 38 percent and overall success rate of 30 percent. However, on the 12 completed wells, success ratio comes to 8 percent. Though, this percentage is still well below the historic average, but likely to improve since the results from at least 15 exploratory wells are pending as these wells are still under drilling status. Given Pakistans low drilling density and healthy success-ratio, the aggressive drilling activity would allow the E&Ps to improve the reserve-base on persistent basis. As of June 30, 2009, 96 applications (81 exploratory & 9 D&P) were under consideration covering an area of 294,050 sq. km. Pakistans indigenous crude oil production fell 6 percent to 24.0m barrels in FY09 according to the data obtained from PPIS, which corresponds to an average daily production of 65.8k barrels per day (kbpd) mainly caused by the natural declines encountered at the maturing fields. Natural gas production, meanwhile, was nearly flat at 4.0 billion cubic feet (bcf) per day from FY08 as First Gas under EWT facility at various fields more than offset the declines in developed fields. June 2009 was the 6th consecutive month in which oil production fell year-on-year. Through out FY09, Pakistans average monthly oil production remained below 70kbpd mark. The last time oil output surpassed 70k barrels a day was June 2008. On an oil-equivalent basis, production in FY09 topped-out at 707kbpd indicating a flattish trend compared to an average flow rate of 709kbpd recorded during FY08. The drop in oil production resulted in an FY09 oil and natural gas production ratio of 9 percent oil to 91 percent natural gas. While OGDC witnessed flat production volume in BOE terms, PPL and POL registered production declines in FY09. On the other hand, Pakistans E&P heavyweight, OGDC witnessed 6 percent decline in oil production during full year FY09. Oil volumes averaged 41.0kbpd in FY09 versus that of 43.5kbpd previously. In June 2009 alone, the oil output remained 14 percent lower at 38.5kbpd. In FY09, the declining oil production was a consequence of lower averages at Bobi (down 23 percent), Chanda (down 12 percent), Dhodak (down 74 percent), Sono (down 15 percent), Thora (down 25 percent) and Lashari-C (down 34 percent) in operating portfolio. Similarly, PPLs BOE production remained 4 percent lower at 167kboe/day during FY09. While oil production at 4.1kbpd (2 percent weight in boe volumes) representing 2 percent increase in FY09, gas volumes of the company dropped by 4 percent to 965mmcfd. In FY09, PPLs premier field Adhi pumped-up 8 percent lower oil at 4.6kbpd. In the same pattern POLs oil production of 3.7kbpd in FY09 was 27 percent lower than the FY08 average of 5.0kbpd. This decline was largely contributed by subdued production volumes at Pindori (down 73 percent) where the water-cut problem still persists.