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January 2, 2018



KP Oil and Gas Company Limited: High-paid professionals do little to complete mega project

PESHAWAR: Khyber Pakhtun-khwa has yet to complete any mega project in the oil and gas sector despite hiring a highly-paid team for the Khyber Pakhtunkhwa Oil and Gas Company Limited (KPOGCL) with unbelievably high salaries and a range of eye-watering perks.

The document provided by the KPOGCL in response to a request under the Right to Information (RTI) Act 2013 indicated that the top officials’ monthly salaries for the first time in the history of the province topped the two million rupees mark.

However, the details provided by the company didn’t include any mega project capable of changing the economic optics of the province.

It took this scribe four months to obtain the required information that too through the Right to Information Commission of the province. The KPOGCL had to provide the details in 15 to 20 days under the RTI law.

The province has been blessed with vast natural resources including huge deposits of oil and gas discovered in its southern districts including Kohat, Karak and Hangu. As of May 2016, according to the budget book, an area of around 360,716 square kilometres was under exploration for oil and gas throughout the country and 32,018 square kilometres is in Khyber Pakhtunkhwa.

In the first year of the incumbent provincial government, eight companies including MOL, Hycarbex, MGCL, OGDCL, OPII, PPL, Tullow and China Zhengue Oil were working in the province and KPOGCL had the largest stake in the exploration activities.

According to the KPOGCL, the oil production in 2013 was 30,000 barrels per day (BPD) and that of gas was 330 mmcfd. In the current financial year the oil production rose to 53,122 BPD and gas to 440 mmcfd while LPG production was 550 tons.

Presently, 10 companies are operating in the province with KPOGCL again holding licenses and leases for most of the area. It is followed by MOL and MPCL while other companies working in the province are Hycarbex, Al-Haj, OPL, PPL, Tullow and Tallahssee.

As a result of the 18th Amendment, the resources of oil and gas are to be shared between the federal and provincial governments at the ratio of 50:50.

In the wake of this development, the provincial government decided to set up the Khyber Pakhtunkhwa Oil and Gas Company Limited (KPOGCL) in 2013 to replicate the federal Oil and Gas Development Company Limited (OGDCL) at the provincial level.

It also announced to build an oil refinery in partnership with Pakistan State Oil (PSO) and also a gas-powered electricity plant in the province.

However, towards the PTI-led KP government’s five-year term will end in May this year but there is still no visible headway on these projects.

The KPOGCL, though, provided a list of its 60 achievements. However, it didn’t mention whether it was operating any oil field or drilling rigs to gradually achieve its production share balance with OGDCL and other companies.

It only referred to an agreement signed with the Frontier Works Organisation (FWO) to set up 40,000 BPD refinery in Karak in which it will get 10 percent share.

The other mega projects it planned to build include a 100,000 BPD refinery in Dera Ismail Khan, 15,000 BPD refinery in Kohat, and three 225 Megawatt (MW) power plants in Hattar, Rashakai and Kohat.

The company’s management at the same time warned that “if the KPOCGL was weakened then these five mega projects may be abandoned.” Perhaps it desired that these things shouldn’t be reported in the media.

However, the information provided by the company about the salaries being drawn by the KPOGCL top management was startling. It was also a bit misleading as the management tried to conceal the exact figures giving a strange logic to defend its act.  

It said the Board of the Directors (BoD) of the KPOGCL has directed the management not to share the company’s specific information on salaries which can be used by the competitors to attract its human resource. It has, however, given the deceptive “minimum and maximum” slabs of salary for officers apparently in a bid to hide the exact amount.

After going through the salary sheet of the managerial staff, the reason for hiding the exact salaries could better be understood. It said the company is being run as corporate body to which a 12-member BoD is providing governance oversight.

The KPOGCL has employed 75 contractual and around 400 daily-wage employees. It is headed by a chief executive officer (CEO) getting Rs2.5 million (maximum) in addition to Rs50,000 monthly entertainment allowance, 600 litres petrol (POL), Rs40,000 for cellphone use, and 50 percent leave encashment and other perks. His deputy, (DCEO) is allowed maximum salary of Rs2 million along with 350 litres POL, Rs40,000 for cellphone use, Rs30,000 entertainment allowance and other perks.

The senior general manager’s salary is Rs1.5 million (maximum), with Rs10,000 monthly entertainment allowance and Rs35,000 for use of cellphone along with other perks. The salaries of general manager, deputy general manager, manager and assistant managers range from Rs150,000 to Rs1million plus certain perks.

A former employee, who has also taken a case to the company’s board of directors to probe its affairs, told The News that the projects accomplished so far didn’t justify the big salaries and hefty perks the KPOGCL officers were getting.