ISLAMABAD: Privatisation Division has sought approval of Cabinet Committee on Privatisation (CCoP) for transfer of 322,460,900 share of Oil and Gas Development Company Limited (OGDCL) to Petroleum Division and subsequently to Pakistan Sovereign Wealth Fund, sources close to Minister for Privatisation told Business Recorder.

Sharing the details, sources said, as part of the privatisation programme, 322,460,900 shares of OGDCL were transferred to Privatisation Commission for its divestment. Owing to inadequate market response, the Cabinet Committee on Privatisation (CCOP), in its meeting held on Nov. 08, 2014, decided to postpone the divestment of GoP shares in OGDCL. Subsequently, during its meeting on May 21, 2021, the CCOP approved the proposal of Petroleum Division not to divest shares in OGDCL.

Legal opinion sought on transfer of OGDCL shares held with PC

This decision of CCoP was ratified by the Federal Cabinet on June 08, 2021. Consequently, OGDCL shares were not divested and remained with PC.

According to sources, a summary was placed before the CCOP in its meeting held on Feb. 07, 2024, to allow Privatisation Commission to transfer OGDCL shares (322,460,900) from PC’s CDC Account to Ministry of Energy (Petroleum Division).

The CCoP while considering the summary of Privatisation Division directed to seek views of Law and Justice Division on the matter and submit the same to the CCOP for consideration. The CCOP’s decision was ratified by the Federal Cabinet on Feb, 15, 2024.

Accordingly, Privatisation Division sought views/comments from Law & Justice Division on the matter which opined that following the enactment of the Pakistan Sovereign Wealth Fund Act, 2023 (PSFWA), OGDCL has become a subsidiary of the Fund. Consequently, the shares under consideration were deemed transferred to the Fund as the ultimate owner and that Ministry of Energy (Petroleum Division) is no more the owner of the transferred shares.

It was further mentioned that the Fund is currently inactive, as the first meeting of Supervisory Council has yet to take place and the formation of the Board and Committees are also pending. Therefore, the best course advised by the Law and Justice Division is to transfer the shares of OGDCL back to the Ministry of Energy (Petroleum Division) and once the Fund becomes fully operational, the Supervisory Council may decide on the transfer of outstanding share in ODGCL to the Fund in terms of sub-section (1) of section 9 of the PSWFA 2023. After explaining background of the case, Privatisation Division has sought approval of Cabinet Committee on Privatisation (CCoP) for transfer of OGDCL shares (322,460,900) from PC’s CDC Account to Ministry of Energy (Petroleum Division).

Copyright Business Recorder, 2024