Need for Developing Unitization Regime & Closing Unitization Issues to Optimize the Economics and Reserves of Straddled Reservoirs in Pakistan

The concept of unitization albeit has been in its infancy under the existing upstream exploration & production oil & gas legal regime in Pakistan, even though there are many straddling reservoirs which continue to be in communication. Therefore, the need to develop a comprehensive legal & regulatory framework that covers all aspects of unitization of straddling reservoirs and closing all pending unitization issues is the dire need of the hour. This is not only critical from the Governments' perspective but is important for the companies subject to unitization to effectively monetize their returns on investment. The paper concludes that in the presence of a strong regulatory framework comprehensively addressing unitization of straddling reservoirs, upstream companies would be forced to unitize, either by incentives or by compulsion while the regulator shall continue to supervise their work programs regarding field development. The paper attempts to provide creative guidance for setting up a comprehensive legal/regulatory framework addressing unitization.