SWOT Analysis

STRENGTHS:
Pakistan Petroleum limited has been enriched with various strengths which
had led it to grow rapidly and sustainably in this competitive oil and gas
sector.
 One of its major strengths include a heavy number of exploration
licenses which it had achieved throughout Pakistan and in some
areas of Iraq and Saudi Arabia which allows it to operate smoothly
and capture numerous markets at various locations and maintain its
presence at key competitive and potentially profitable locations.

 Quality is also one the strengths of PPL as it has maintained its ISO
certification which indicates that it has been successful in providing
quality services to its customers and achieving their precious
satisfaction.

 PPL has been the pioneer of exploration and production in the oil and
gas sector of Pakistan. It has been the discoverer of Pakistan’s oldest
and largest gas field at Sui which contributes around 25% of
Pakistan’s gas production

WEAKNESSES:
 PPL has been focused in the production of oil and gas which poses it
to the risk of over reliance on a particular segment which could be
harmful if the whole segment faces its decline stage.

 Another weakness of PPL is its longer receivable days from 178 to

199 as calculated before. This indicates that PPL has been facing
major crisis in its recovery of dues from customers which could lead
to severe liquidity problems.
 PPL has around 68% of shareholding in the hands of Government of
Pakistan. This often leads to delay in the decision making process of
PPL as it had to be approved by the government and a number of
formalities are being imposed.

 Working capital remained under stress on account of continued

increase in circular debt related receivables which restricted the
translation of top-line growth into the operating cash flow

OPPORTUINITES:

 Offshore is another opportunity that the Company is actively pursuing

with its partners, and with the optimistic current oil prices, offshore
well in Indus-G Block is planned. A sizeable discovery in this area
may prove to be a game changer for the Company and the country as
well.
 With respect to international operations, the Company is planning to
drill its first well in Iraq.
 The Company is geared up to participate in the forthcoming
exploration bid round, to acquire new blocks to further expand and
diversify its exploration portfolio as part of its strategy for hydrocarbon
reserves replacement.
 Planning to diversify its product base in order to mitigate the risk of
over reliance on a particular segment to some extent.

THREATS:

 Security issues in frontier areas and massive transportation,

particularly common in the Balochistan fields where law and order
situation is disturbed and various tribunal issues contravene with the
piece of the area.
 And another most dangerous threat to PPL is the threat of new
entrants into the market (This can dilute the market share of PPL
which could have devastating effects on the company.

 Adverse conditions of Pakistan in terms of economic and political

instability, this widely affects PPL’s operations and has the potential
to become massively unfavorable for the organization