Earnings up 24% QoQ, 1% YoY; overall sales reach Rs232 billion, tax rate falls to 28%, exploration costs decline 10%.
Pakistan’s exploration and production (E&P) sector reported earnings of Rs92 billion in the third quarter of FY2026, reflecting a 24% increase quarter-on-quarter and a 1% rise year-on-year, driven by higher oil prices and lower operating costs, according to the data compiled by Topline Pakistan Research.
Sector revenues increased to Rs232 billion, up 7% quarter-on-quarter and 1% year-on-year. The growth was supported by a 23% increase in oil prices during the quarter, with Arab Light crude averaging $80.38 per barrel compared to $65.37 per barrel in the previous quarter.
Exploration expenses declined 10% year-on-year, mainly due to fewer dry wells. Only one dry well was recorded during the quarter, compared to two in the same period last year, with activity by Mari Petroleum Company Limited.
Other income for the sector fell 23% year-on-year to Rs19.7 billion, reflecting lower interest rates and exchange losses following currency appreciation.
Finance costs declined 16% year-on-year to Rs3 billion in the quarter, taking cumulative costs for the first nine months of FY2026 to Rs10 billion, down 40%, supported by a lower interest rate environment.
The sector’s effective tax rate decreased to 28% in 3QFY26 from 32% a year earlier, partly due to tax reversals recorded by MARI.
Among key companies, Oil and Gas Development Company Limited posted a 10% year-on-year decline in earnings due to lower other income, although profits increased 22% quarter-on-quarter on higher revenues and reduced exploration costs. The company announced a cash dividend of Rs3.25 per share, taking its nine-month payout to Rs11.0 per share.
Pakistan Petroleum Limited reported a 5% decline in earnings year-on-year but a 2% increase quarter-on-quarter, with higher operating costs weighing on performance. The company declared a dividend of Rs2.0 per share, bringing its nine-month payout to Rs6.0 per share.
Mari Petroleum Company Limited recorded earnings growth of 33% year-on-year and 65% quarter-on-quarter, supported by higher other income and a sharp decline in its effective tax rate to around 1% during the quarter.
Pakistan Oilfields Limited reported an 18% increase in earnings year-on-year and a 24% rise quarter-on-quarter, driven by lower taxation and higher other income.
