Govt decides to return 322.461m OGDC shares from PC to PD

ISLAMABAD: The government has decided to return 322,460,900 shares of OGDCL to Petroleum Division (PD) to give them to a friendly country.

The Cabinet Committee on Privatisation (CCoP) will decide on the matter in its meeting on August 2. These shares of OGDCL were earlier transferred to PC for doling them out to a friendly country. The PC, however, failed to deliver because of inactive Sovereign Wealth Fund.

The CCoP will also approve privatisation programme of various public sector entities during the ongoing Financial Year. The forum is also likely to approve Rs8 billion for the Privatisation Commission.

Sources said the Privatisation Commission has earned a profit of Rs35 billion on OGDCL’s shares of 322.461 million, out of which Rs21 billion has been given to the Finance Division, while Rs14 billion still rest with PC.

The Oil and Gas Development Company Ltd. was included in the Privatisation Programme for Early Implementation by CCoP on October 3, 2013.

The PC Board approved the appointment of consortium comprising Merrill Lynch International, Citigroup Global Market Limited and KASB Bank Limited as Financial Adviser in April 2014 for divestment of up to 10pc GOP shares in OGDCL. As part of OGDCL transaction, the Petroleum Division provided a Jumbo Certificate of 322,460,900 physical shares to PC in September 2014.

The physical shares were converted into PC’s CDC Account as physical securities could not be traded in the market. Owing to inadequate market response, CCoP in its November 8, 2014 meeting decided to postpone divestment of GoP shares in OGDCL. As divestment of OGDCL shares was postponed, the said shares remained with PC.

The Fund is currently inactive, as the first meeting of Supervisory Council has yet to take place and formation of board and committees are also pending. Therefore, the best course advised by Law and Justice Division is to transfer the shares of OGDCL back to Ministry of Energy. Once the Fund becomes fully operational, Supervisory Council may decide on transfer of outstanding share in ODGCL to the Fund.

The Privatisation Division has sought approval of CCoP for transfer of OGDCL shares (322,460,900) from PC’s CDC Account to Ministry of Energy (Petroleum Division).