Government of Pakistan

Privatization Commission

Pakistan Announces Launch of Secondary Offering of Shares in OGDCL


Islamabad, November 13, 2006

The Privatisation Commission of the Islamic Republic of Pakistan today announced that it expects this week to launch a secondary offering of ordinary shares and Global Depositary Shares (“GDSs”) (the “Offer”) of Pakistan’s Oil and Gas Development Company Limited (“OGDCL”). The GDSs are expected to be listed on the London Stock Exchange.

The Offer will represent up to 15% of the share capital of OGDCL, comprising up to 645,139,000 shares. The Offer consists of (a) an institutional offering of up to 532,939,000 shares, in the form of ordinary shares to institutional investors in Pakistan and GDSs to international institutional investors, including to Qualified Institutional Buyers in the United States under Rule 144A, and (b) a retail offering of up to 32,300,000 ordinary shares to private investors in Pakistan.

The Offer may include an over-allotment option for the institutional tranche of up to 79,900,000 additional shares, in the form of ordinary shares and GDSs.
All of the proceeds from the Offer will be received by the Islamic Republic of Pakistan, the selling shareholder.

The GDSs are expected to be listed on the London Stock Exchange, with each GDS representing 10 underlying ordinary shares. The ordinary shares are listed on the Karachi Stock Exchange, Lahore Stock Exchange and the Islamabad Stock Exchange.

The price for the shares and GDSs offered in the institutional offering will be fixed following a bookbuilding process on or around the 30 November, with the price and allocations for the shares and GDSs announced on or around the 1 December. The first day of unconditional trading for the GDSs on the London Stock Exchange is expected to occur on or around the 6 December.

The retail offering will take place after the closing of the institutional offering at a discount to the final institutional offer price.

This Offer represents the first time that Pakistan’s domestic institutional investors will be participating in an international bookbuilding for a publicly traded, Pakistan-listed company.

BMA Capital, Citigroup and Goldman Sachs are Joint Lead Managers with Citigroup and Goldman Sachs acting as Joint Global Co-ordinators and Bookrunners for the international offering and BMA Capital as Lead Manager and Bookrunner for the domestic offering and joint lead manager of the international offering.

While launching the transaction Zahid Hamid, Minister for Privatisation and Investment, said

“This is the largest ever equity offering of a Pakistani company abroad, and is, of course, a very important part of our ongoing privatisation programme. The offering will help raise further awareness amongst the international investment community of the exciting investment opportunities that are available in Pakistan today. It will also broaden OGDCL’s investor base, enhance its international profile and expedite its transition into a truly world-class, publicly-listed commercial enterprise.”

Mr Arshad Nasar, Chairman and Chief Executive Officer of OGDCL, said:

“I am excited by today’s announcement, which represents a significant landmark in our Company’s history. The Offer will allow us to build a diversified, high-quality investor base; as we strive to achieve operational excellence and world class standards of corporate best practice.“

“As the leading exploration and production company in Pakistan, our primary objective is to enhance our production and reserve profile and, ultimately, to maximise value for our shareholders. We look forward to welcoming our new shareholders as we embark on our next phase of growth.”

Overview

OGDCL is the largest petroleum exploration and production, or E&P, company in the Pakistan oil and gas sector, with a primary focus on gas. It holds the largest portfolio of the recoverable hydrocarbon reserves of Pakistan, at 32% of gas and 37% of oil, respectively, as of June 30, 2006, and contributed 22% of the country’s total natural gas production and 48% of its oil production for the year ended June 30, 2006 on a net basis1.

With a portfolio of 46 exploration licences, the company has the largest exploration acreage in Pakistan, covering 39% of the total awarded as of June 2006. While its focus to date has been on onshore exploration, the company has also recently begun conducting offshore exploration activities, an area which the company believes has significant untapped potential.

OGDCL had a net profit PKR 45.8bn for the year ended June 30, 2006 and PKR 12.0bn for the three months ended September 30, 2006.

1 based on data compiled by the Directorate General of Petroleum Concessions, or DGPC

These materials are not an offer of securities for sale in the United States. The securities may not be offered or sold in the United States absent registration with the United States Securities and Exchange Commission or an exemption from registration under the U.S. Securities Act of 1933, as amended. The Company has not registered, and does not intend to register, any portion of the offering in the United States, and does not intend to conduct a public offering of Securities in the United States.

This communication is directed only at (i) persons who are outside the United Kingdom or (ii) persons who have professional experience in matters relating to investments falling within Article 19(1) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) and (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2) of the Order (all such persons together being referred to as “relevant persons”). Any investment activity to which this communication relates will only be available to and will only be engaged with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.

This document is an advertisement and not a prospectus and investors should not subscribe for any securities referred to in this document except on the basis of the information in the prospectus to be published by the Company in due course in connection with the admission of the Company’s Global Depositary Receipts to the Official List of the Financial Services Authority. Copies of the prospectus will, following publication, be available from the Company’s registered office.

The information contained in this communication does not constitute an offer of securities to the public in the United Kingdom within the meaning of the Public Offers of Securities Regulations 1995. No prospectus offering securities to the public will be published in the United Kingdom. Persons receiving this communication in the United Kingdom should not rely on it or act on it in any way.

In any EEA Member State that has implemented Directive 2003/71/EC (together with any applicable implementing measures in any Member State, the “Prospectus Directive”) this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive.

Source: http://www.privatisation.gov.pk/Handout/HO-AR-06/Nov-06/Handout%20Nov-%202006.htm