Ministry may give extension to defaulter company

Islamabad

The Ministry of Petroleum and Natural Resources is considering granting extension to a defaulter company for exploration of oil and gas in Yasin-Peshawar-Karachi blocks despite the fact that it owes $12 million to the government, it has been learnt.

Documents available with The News show that Hycerbex American Energy Inc had just less than $50,000 assets in its account as per information provided by the US Security Exchange Commission.

The company recently borrowed $200,000 from a private investor at 5% interest per annum to run its administrative affairs.

The company had three blocks — Yasin, Peshawar and Karachi. Yasin block was granted licence in 2001 and for the last four years it has been a defaulter of $4 million on account of rental, social welfare, training and production bonus.

The government issued a letter to the company on July 3, 2015 advising it to discharge the long-delayed contractual obligations which are not settled till today.

Similarly, Peshawar and Karachi blocks were granted licences in 2010 with the obligation of $5.9 million and $2.75 million respectively. 

The company neither spent even a single penny on these two blocks nor did it honor its obligation for training, social welfare and rental, which are fundamental responsibilities to retain the concessions.

The letter also advised the company to discharge 22.5 million against Peshawar block and 20 million against the Karachi block.

In the regular practice with the government petroleum concession blocks are granted against bank guarantees but these two blocks were granted against hypothecation on production of Yasin block. 

Yasin block has not been producing hydrocarbon since April 2015 so the DG PC is bound to ask for bank guarantee on account of Peshawar and Karachi blocks from the company and cancel the blocks on non-performing basis and ask for damages.

Instead of revoking the bank guarantee they are planning to give extensions. As per policy, the government has already revoked nine other concessions in respect of default.

The News tried to reach Minister for Petroleum Shahid Khaqan Abbasi through his cell phone and sent him text message with details of the story to get his point of views but he did not respond.

DG Petroleum Concession said they had served a notice on the company for cancellation of licence and were waiting for the reply. It has been learnt that the company has offered post-dated cheques.

It merits mention that the PTI chief Imran Khan addressed a press conference on in Peshawar on Feb 21 this year in the presence of company representative alleging that the Ministry of Petroleum and Natural Resources was not issuing NOC to the company for exploration of oil and gas in the KP.

In a press conference the very next day Petroleum Minister Shahid Khaqan Abbasi had said that the company was a defaulter of one block.