PM endorses gas sale mechanism approved by Dar's task force

ISLAMABAD: Prime Minister Shehbaz Sharif on Sunday gave a go-ahead to the implementation mechanism earlier okayed by the 20-member task force headed by Deputy PM Ishaq Dar on November 18 for enforcing the amended E&P policy 2012, which allows the Exploration and Production (E&P) companies to sell 35 percent gas from their future gas well to private sector on auctioned prices.

The Council of Common Interest had approved the mechanism on January 26, 2024.

“The Implementation Framework will be submitted to the Executive Committee of the National Economic Council (Ecnec) today (Monday) for approval,” senior officials who were part of the meeting told The News. “The approval by Ecnec is required to pay $5 billion investment by E&P companies in the oil and gas sector.”

The meeting that was held with the prime minister in the chair on oil and gas-related issues also witnessed a heated debate between the Petroleum minister and top-ranking officials of the Petroleum Division when issues like a contract between Azerbaijan’s SOCAR and PSO on energy trade and issue between Jamshoro Joint Venture Limited (JJVL) and Sui Southern issues were highlighted in the meeting.

Prime Minister Shehbaz Sharif, however, according to the insiders, expressed his displeasure over differences between Petroleum Minister Musadik Malik and high-ranking officials on alleged ‘bypassing the minister on vital issues’.

The insiders told The News, “The Secretary and Additional Secretary (Policy) of the petroleum division presented their case, arguing that they never went against the policies and kept the minister in the loop all the time.”

When contacted, Federal Minister for Petroleum Musadik Malik, said that Additional Secretary (Policy) has been removed by the PM Office based on the audit of some administrative matters, saying this is a routine performance management activity.

In his written reply, the minister did not address the issue of being being bypassed by top officials.Malik, according to the insiders, raised certain issues in the meeting, including cooperation on vital decisions, and pointed out that Azerbaijan has complained that Petroleum Division’s bureaucracy is not advancing with Azerbaijan’s government on the GtG agreement between SOCAR and PSO agreement on LNG and POL products.

The top ranking officials, however, told the premier that during the zoom meetings with Azerbaijan’s officials held some days back, Azeri officials were quite satisfied and their satisfaction is on official record. “Additional secretary (P) to this effect, presented the official record before the premier. But the letter from Azerbaijan government showed the different story,” sources said.

The Petroleum minister, according to the officials, also mentioned in the meeting the issue of JJVL on which he told the premier that he was not taken into confidence to make it operational.

The additional secretary said that on this issue there is no breach of any policy, as it is the commercial dispute between JJVL and Sui Southern. “Sui Southern was just asked if it agrees on new terms and conditions for running JJVL LPG plant, to come up with the response and meet with the JJVL management as per the decision taken by SIFC,” the sources said while quoting the top bureaucrats in the meeting.

However, this correspondent contacted Additional Secretary Zafar Abbas on the development, but he preferred not to answer.