Mari Energies Awards Spinwam Gas Deal to UGDCL Under Third-Party Sale Policy, Signalling New Momentum for E&P Investment

Islamabad: Mari Energies Limited has awarded a contract for the sale of up to 17.5 million cubic feet per day (MMscfd) of gas from the Spinwam Gas Discovery in the Waziristan Block to Universal Gas Distribution Company (Pvt) Ltd, marking one of the most significant commercial transactions under Pakistan’s Third-Party Gas Sale Policy.

The company disclosed to the Pakistan Stock Exchange that the award follows a competitive bidding process initiated through an invitation published in May this year. The transaction remains subject to regulatory approvals under the Framework for Sale of Gas to Third Parties, notified through S.R.O. 11(I)/2025.

Industry observers view the development as an important test case for the government’s market-based gas sector reforms. The Third-Party Sale Policy enables producers to market gas discoveries directly to eligible buyers through competitive bidding instead of relying solely on conventional state-sector arrangements, introducing greater commercial flexibility into Pakistan’s upstream energy market.

The policy is expected to unlock stranded and marginal gas discoveries that previously remained commercially unviable because of delays in allocation or pricing. By creating a transparent, competitive marketplace for domestic gas, it is also likely to encourage fresh exploration activity and improve investor confidence in Pakistan’s exploration and production (E&P) sector.

Analysts believe wider implementation of the policy could pave the way for nearly $5 billion in new investment over the medium term as exploration companies accelerate drilling programmes, appraisal activities and field developments backed by improved monetisation prospects.

The reform also carries significant fiscal implications. Market-based gas sales can generate higher revenues for producers such as Mari Energies while increasing government receipts through royalties, taxes, petroleum levies and other statutory payments. Earlier commercialisation of discoveries is also expected to provide advance cash flows to both the producing companies and the government.

From a macroeconomic perspective, faster development of indigenous gas resources could help reduce Pakistan’s dependence on imported fuels, lowering the burden on the external account and easing pressure on the country’s energy finances.

Energy experts further argue that the policy can contribute to curtailing the power and gas sectors’ circular debt by improving payment discipline, enabling commercially negotiated pricing, reducing delays in field development and increasing the availability of domestic gas for industrial consumers. Enhanced competition among buyers is also expected to promote greater efficiency and transparency in gas allocation.

Mari Energies is the operator of the Waziristan Block with a 55 per cent working interest, while Oil and Gas Development Company Limited holds 35 per cent and Orient Petroleum Inc. owns the remaining 10 per cent.