OGDCL agrees to pay Rs12.6bn royalty to Balochistan govt

QUETTA: The Oil and Gas Development Company Limited (OGDCL) has reached an agreement with the Balochistan government to pay Rs12.6 billion as royalty for the Uch Gas Field.

OGDCL had ceased royalty payments to the Balochistan government since September 2021 due to an unusual surge in the revolving credit of power-buying entities. Under the terms of the agreement, both parties have established a mechanism for the payment of royalties spanning from August to January 2024, to be disbursed on a monthly basis.

This development comes after the Balochistan government took proactive measures to secure billions of rupees owed by the OGDCL as royalty for the Uch Gas Field.

The issue was brought to light by Balochistan’s caretaker Chief Minister Mir Ali Mardan Khan Domki at national forums. In response to the caretaker provincial government’s stance, OGDCL has now agreed to settle the outstanding royalty payments spanning three years.

Mir Ali Mardan Khan Domki emphasized that royalty is the entitlement of Balochistan and vowed to utilize it for the betterment of population. The caretaker administration successfully ensured the retrieval of pending royalty payments owed to Balochistan over the past three years. Domki underscored the obligation of companies operating in Balochistan to comply with relevant laws on royalty payments.

He expressed satisfaction with the mutual settlement and understanding between OGDCL and the provincial government regarding the resolution of outstanding royalty issues over the past three years. “Thanks God, we have been successful in convincing Balochistan’s stance at the national forum. Companies operating in the province are bound by the laws to pay royalties, and these funds will be used for social and economic welfare and improving the quality of life. Royalty is the right of Balochistan which cannot be compromised.”