OGDC to Receive Rs. 80 Billion from Uch Power Plant

The Oil & Gas Development Company (OGDC) is set to recover Rs. 80 billion from the Uch Power Plant as part of the ongoing efforts to resolve the power sector’s circular debt. The update was shared during the Pakistan Day Conference 2025 for foreign investors.

The event, organized by Topline Securities, featured OGDC’s Chief Financial Officer, Mr. Anas Farook, as the keynote speaker. He highlighted the company’s recent financial progress, with the resolution of circular debt described as a major milestone in stabilizing the sector.

As part of its financial recovery plan, OGDC expects to receive the second interest installment of Rs. 7.7 billion against Term Finance Certificates (TFCs) issued by the government within the next seven days. Once this payment is made, the outstanding interest will fall to Rs. 76.6 billion, which will be cleared over the next ten months.

In addition to debt recovery, OGDC has already released Rs. 42 billion in dividends to the government, representing 10 percent of its shareholding, while simultaneously settling other liabilities.

To address challenges related to forced gas curtailment, the company is working closely with the government on multiple solutions. These include selling gas to third parties, diverting cargoes, and coordinating with SNGPL to shift curtailment toward lower oil-yielding fields. This strategy is designed to protect production levels from the key Nashpa field.

On the international front, lenders for the Reko Diq project are in the final stages of securing board approvals, with financial close anticipated by late September or early October 2025.

During the conference, OGDC’s management also revealed that the company currently holds a combined oil and gas reserve life of 14 years, supported by a near 100 percent reserve replacement ratio, which secures long-term production sustainability.

The company is also actively working to boost oil output through advanced extraction techniques, including the installation of Electrical Submersible Pumps (ESPs). These measures are expected to allow OGDC to recover 60–70 percent of reserves, a significant improvement from the current recovery rate of 30 percent.

Furthermore, OGDC has signed a Memorandum of Understanding (MoU) with Turkish Petroleum for offshore exploration blocks. The company is also engaged in discussions with several U.S.-based petroleum and services companies as part of Pakistan’s ongoing offshore bidding round, highlighting its commitment to expanding exploration activities both domestically and internationally.