Oil Marketing Companies: Ogra raises licensing fee to Rs 5 million from Rs one million

Oil and Gas Regulatory Authority has increased licensing fee for Oil Marketing Companies (OMCs) from Rs one million to Rs 5 million in a bid to enhance its income, it is learnt. Sources in the Ministry of Petroleum and Natural Resources told Business Recorder, here on Tuesday that the regulatory body has increased licensing fee for the OMCs manifold and as per the new fee it has recently issued two licenses.
Sources said that the regulatory body has locked horns with the Petroleum Ministry over deregulating the petrol prices and has refused to allow the OMCs of fixing petrol prices on their own. "When the Director General (DG) Oil was regulator the government was issuing the OMC license at Rs 3,500 and after 2002 when the government made OGRA to regulate oil/gas sector in first phase regulatory body enhanced the OMCs licensing fee from Rs 3,500 to Rs 100,000 than from one lakh to Rs one million and now it has fixed OMCs licensing fee at Rs 5 million," the official said.
When asked from an official of OGRA as why the authority has increased the OMCs licensing fee manifold, the official replied Ogra authorities have increased the fee to secure financial position of the regulatory body. The Petroleum Ministry officials also stated that the government is to increase the OMCs margin on High Speed Diesel (HSD) by Rs 0.19 per litre and dealers' margin by Rs 0.40 per litre in the next meeting of the Economic Co-Ordination Committee of the Cabinet (ECC). The official added that "the increase in the OMCs' margin on HSD, after adjustment of interim relief, has been revised to Rs 0.19/litre by applying CPI (16.40%) for the period November 2011 to February 2014 announced by the Pakistan Bureau of Statistics (PBS); and OMCs' and dealers' margins on HSD were proposed to be fixed ie OMC - Rs 2.02 from Rs 1.86 per litre - increase Rs 0.16 per litre and dealers - Rs 2.70 from Rs 2.30 per litre, showing an increase of Rs 0.40 per litre".