THE Oil and Gas Development Company — the energy giant — stands tall over all the companies listed on the country’s stock exchanges in more ways than one. It is unchallenged as the biggest oil and gas exploration and production company. It commands the largest market capitalisation of Rs1.15 trillion. On December 31, 2013, it held a staggering Rs480 billion in total assets.

OGDC claims to be the highest profit earner among all companies in the country, and it is also the highest revenue generator for the government in the form of dividends, since the state is the majority stakeholder with a 74.97pc stake in the company.

“OGDC contributes 55pc to the country’s total oil production and 28pc to its entire natural gas output,” Muhammad Riaz Khan, Managing Director of OGDC, told Dawn last Thursday.

In order to enhance its reserves and production base, the company added 29 new exploration blocks in March 2013. Its chief informed that work on the Dera Bugti Kolu will begin in the next 4-6 weeks.

Asked if the security situation was a concern, OGDC’s chief executive officer shrugged his shoulders. “It is a high risk, high reward business.”

Yet, he said the company has taken good care of the local population by providing jobs, medical care, clean water, education for children, and other social services. “We mitigate the risk by first doing what can be done above ground, before going into drilling under the ground,” he said.

Over the 50 years of its existence, OGDC has grown to be the market leader in terms of reserves, production and acreage. As of December 31, 2013, it held the largest exploration acreage in the country, covering an area of 51,307sq km across the company’s 33 owned and operated joint venture exploration concessions.

In addition, it held working interest in six blocks operated by other exploration and production companies.

During July-December last year, OGDC marked 22 well locations on the ground, out of which seven wells were spud. According to its latest half yearly accounts, OGDC’s total remaining recoverable reserves as of December 31 stood at a huge 208 million barrels of oil and 10,063.62 billion cubic feet of gas.

OGDC was listed on the country’s three stock exchanges in October 2003. That year, the Privatisation Commission of Pakistan made an initial public offering of OGDC shares worth a massive Rs6.9 billion, at a price of Rs32 per share. It stood out to be the biggest stock offering in the history of the country’s capital markets.

In December 2006, the government divested a further 10pc of its holding in the company at Rs110 per share. OGDC’s global depository receipts have been traded on the London Stock Exchange since December 2006.

Due to the overwhelming size of its market capitalisation, the company’s stock commands over 15pc weightage in the Karachi Stock Exchange 100 Index. This means that the rise or fall of a single rupee in the price of OGDC stock results in an addition or deduction of 15 points from the index.

A share of OGDC, therefore, in great measure, commands the power to set the direction of trading at the stock market on any particular day. Its share of par value of Rs10 traded last Friday at around Rs269.

Foreign investors, particularly Franklin Templeton Investments, has a sizeable stake in the company’s equity, which is both a boon and a bane for the market. Although Franklin Templeton is reputed to be a long-term investor (mainly in the energy sector), the market cannot shrug off fears that in the event of the foreigner’s unlikely decision to exit in haste, the entire capital market could be thrown into turmoil.

OGDC sports a strong balance sheet, with total reserves at Rs358 billion, nearly eight times the paid-up capital of Rs43 billion. For the year ended June 30, 2013, the company posted a profit of Rs91 billion. This translated into earnings-per-share (eps) of Rs21.11.

For the six months ended December 31, the company recorded net earnings of Rs67 billion, which produced eps of Rs15.63. The board announced a second interim cash dividend of Rs2 per share, taking its total payout to Rs4 per share for FY14 year-to-date.

During July-December 2013, OGDC’s net sales grew by 14pc to Rs126.2 billion, from Rs110.6 billion in the same period a year ago.