Muhammad Arif
The PTI led Government should immediately start working on a new Petroleum Policy which should be evolved, inter alia, around the following:
1. The scope of Special Security Division of the Pak Army created for CPEC projects should be extended to include provision of security protection to all the national and international companies involved in Pakistan exploration and production operations especially in the provinces of Balochistan and KPK provinces.
2. Once Scope of the Special Security Division is extended to include E&P operations, the existing license holders who are sitting on different exploration blocks after declaring Force Majeure should be given a 30 days time to lift such Force Majeure and start operations without wasting any further time, failing which such blocks should be cancelled and regranted through competitive bidding.
3. Policy for grant of extension and renewals of the licenses should be rationalized.
4. Office of the DGPC should be upgraded to the status of Upstream Regulatory Authority and all decisions relating to the upstream E&P operations should be made by such an Authority without going through the bureaucratic system or provincial governments.
5. The Upstream Regulatory Authority should be manned by competent professionals from the market on market based terms and conditions.
6. There are more than 30 producer gas pricing mechanisms and prices prevailing in Pakistan at the moment. It makes all the economic sense to rationalize and standardize natural gas price for all the producing fields in Pakistan.
7. Regulatory process should have fixed timeline for certain approvals failing which such submission should be deemed to have been automatically stand approved by the Authority.
8. Board members of the state entities should be carefully selected being professionals of integrity and competence. Chief Executives of all the State Owned Companies should be appointed by the relevant Board of Directors and Government should not interfere in the day to day operations of such state entities.
9. The Board should be made responsible for institutional inefficiencies and organizational weaknesses.
10. Non-commercial measures should be taken to create “enabling environment”. No increase in Oil and Gas prices should be promised rather existing (2012 Policy) gas and oil pricing formula for oil and gas producers need to be rationalized.
11. A mechanism for quick filling of all key positions (succession planning) in the state owned organizations and OGRA should be put in place to ensure ownership, continuity and accelerate decision making process.
12. While simultaneously pursuing for IPI and TAPI gas pipeline projects, Pakistan should apply a “big push” theory to accelerate exploration in Pakistan to increase domestic oil/gas production.
– The author is an Energy Lawyer and Consultant.
arif@arif-associates.com
