ISLAMABAD: A parliamentary panel on Thursday dismissed claims made by the Oil and Gas Development Company Limited (OGDCL) that certain blocks could be exempted from production bonus terms.
The panel deemed this exemption a violation of the Supreme Court of Pakistan's directives.
Umer Farooq chaired the meeting of the Senate Standing Committee on Petroleum held on Thursday.
Comprehensive briefing by the Petroleum Division and District Administration of Sanghar was sought on the outstanding production bonus and royalty paid and CSR carried out for the development and welfare of District Sanghar by all oil and gas companies which earning huge money from the said district since 2013.
Zia Salahuddin, executive director (services) informed the committee that the OGDCL had partnership with UEPL in Sinjhoro Block (Sanghar); however, the OGDCL was exempted under old Petroleum Exploration Policy as per document but their partner in the block deposited $75,000 production bonus in District Sanghar since 2013 to 2024.
Acting Director General (DG) Petroleum Concession also endorsed him and said that such exemptions were granted to OGDCL in old petroleum policies.
Member committee Quratul Ain Marri challenging the OGDCL and Petroleum Division’s stance and said it was violation of Supreme Court of Pakistan verdict in the case of production bonus. “In its ruling Supreme Court issued directive to OGDCL (by name) to deposit production bonus.”
Secretary said he did not know about this and would find out.
She said why secretary did not have time to look into the matter before attending the committee meeting.
She also offered the copy of verdict of Supreme Court of Pakistan.
The chairman directed secretary Petroleum Division to come up with all relevant information and also called DC Sanghar to come in the Parliament and give briefing on production bonus.
Summary of production bonus due/deposited in District Sanghar since 2013 to 2024 was$16,841,000. PPL deposited $1290,000 for Gambat South and $276,000 for Hala, UEPL deposited $15,200,000 for Khipro.
The companies are required to discharge their production bonus strictly in accordance with the provisions of government policy of Petroleum Concession Agreements (PCA) and applicable guidelines. The amount of production bonus pledged by the companies in their respective agreements must be utilised to give benefit to the communities as per applicable production bonus rates under various policies.
Under Petroleum Policy 1994, 1997 and 2001 on commencement of commercial production from $500,000 to 5,000,000 production bonus defined which was increased to $600,00 to $7,000,000 in Policy 2009-2012.
However, as per Petroleum Policy 2012, the production bonus will be expended on social welfare development project and around the area, as per guideline issued by the provincial government from time to time.
Copyright Business Recorder, 2024
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