PPL Asia secures $6m settlement from Iraq’s Midland Oil Company

KARACHI: PPL Asia E&P BV (PPL Asia), a wholly-owned subsidiary of Pakistan Petroleum Limited (PPL), has received a $6 million settlement from Midland Oil Company (MdOC), an Iraqi state-owned oil entity, marking the successful closeout of the Exploration, Development, and Production Service Contract (EDPSC) for Block-8 in Iraq.

The company shared the development in a notice to the Pakistan Stock Exchange (PSX) on Monday: “This is further to our letter regarding the successful settlement with Midland Oil Company (MdOC). We are now pleased to notify that PPL Asia E&P BV (PPLA) has received the amount of $6 million on January 3, 2025, in relation to the closeout of the above-referred EDPSC.”

PPL mentioned that the payment concludes negotiations with Iraqi authorities and reflects a milestone in safeguarding the company’s financial interests.The settlement agreement was finalised in October 2024 and officially signed on October 6, 2024, in Baghdad, by PPL Asia Managing Director Imran Abbasy and MdOC Director General Muhammad Yaseen Hassan.

Under the terms of the agreement, MdOC committed to a net payment of $6 million to PPL Asia through a third party. The settlement concludes a chapter that began in 2012, when PPL Asia was awarded the EDPSC for Block-8 in Iraq.

Drilling commenced in April 2019 at the Madain-1 well in Block-8, resulting in the discovery of sub-commercial volumes of oil. The well was subsequently plugged and abandoned in FY20, paving the way for the eventual settlement.

The company said that the settlement represents a significant achievement, allowing PPL Asia to successfully close its operations in Block-8 while maintaining financial stability.