Pakistan Petroleum (PPL) has reported lower than expected earnings for third quarter ended 31st March 2019. The deviation from analysts’ estimates was mainly on account of higher than expected exploration expenses. For the quarter under review, PPL’s revenues grew by a decent 31%YoY, led mainly by around 20% depreciation of Pak rupee. Arab Light crude prices declined by 3% to US$63.8/barrel, while oil and gas production were up meagerly by 3% and 2% respectively. For the quarter, exploration charges were up 68%YoY, mainly due to higher dry well costs. For 9MFY19, sales of the company were up 30%YoY, while earnings grew by 32%. Other income surged by 16%, which was mainly on the back of exchange gain on foreign currency due to depreciation of Pak rupee. The likely threats facing the company include: 1) persistent volatility in global oil prices, 2) delay in key projects and 3) significant increase in exploration and development costs.