The Ministry of Petroleum and Natural Resources will hold a meeting of provinces next week to finalise the up-coming 'petroleum policy 2011' so that all issues relating to oil/gas exploration and development could be resolved under one roof. An official of Ministry of Petroleum and Natural Resources on Monday said that a meeting of all stakeholders would be held within a week to this effect.
The federal government would take federating units on board in finalising the 'Petroleum Policy 2011, following 18th amendment. He said that after the passage of 18th constitutional amendment, the provinces claimed to have 50 percent rights on oil and gas exploration sector and therefore they were insisting to regulate upstream industry. However, he said, upstream industry wanted one-window facility for regulations to resolve their issues arising after implementation of 18th amendment.
He said that the federation was in a fix following the passage of 18th Amendment, as under it most of federal responsibilities shifted to provincial governments, but still there were multiple issues between the federal and provincial governments, which are yet to address.
Additional Secretary, Ministry of Petroleum, Naeem Malik, said that Ministry of Petroleum and Petroleum Exploration and Production Companies Association (PEPCA) had sought legal opinion on the issue of regulating upstream industry. "We want to take provinces on board in the whole process of drafting petroleum policy 2011, as drafts of legal opinions were sent to provinces for further consultation," he added.
He said that after the passage of 18th constitutional amendment the provinces have been given rights over their resources, but it has created confusion among investors, and the federal government is to initiate one-window operation to deal with the issues. "The investors are willing that issues relating to gas/oil exploration and development should be resolved under one roof," he added.
"Law Division has supported Ministry of Petroleum point of view that federal government could regulate upstream industry after 18th amendment," he said, adding that Pepca had sought similar legal opinion. He said that after approval of new Petroleum Policy 2011, Petroleum Concession Agreement (PCA) would be finalised to auction 22 blocks. He maintained that the government would announce $6 per million cubic feet (mmbtu) price in new policy 2011 against $4.5 per mmbtu in petroleum policy 2009.The maximum gas price for offshore wells would be $9 per mmbtu.
Another official said that a proposal was under study to form an independent 'authority', like Indus River System Authority (Irsa), to regulate oil and gas exploration sector, but exploration companies had not agreed with the proposal. Production and exploration companies are of the view that provincial representatives should be a part of the consultative body and participate in its meeting to resolve time to time issues between federal and provincial governments.