The Cabinet Committee on Privatisation (CCoP) has initiated steps to seek legal counsel regarding the proposed transfer of Oil & Gas Development Co. Ltd. (OGDCL) shares currently held by the Privatisation Commission (PC). This move comes as part of a broader strategy to determine the appropriate recipient for these shares, whether the Petroleum Division or the Sovereign Wealth Fund (SWF).
The decision to seek legal opinion was made during a recent CCoP meeting chaired by caretaker Minister for Privatisation, Fawad Hasan Fawad. The proposal, initially put forward by the Petroleum Division, aims to transfer the OGDCL shares, which have been with the PC since their postponement from divestment following inadequate market response.
The transfer proposal was discussed in light of previous directives from the CCoP and Federal Cabinet decisions regarding the divestment of OGDCL shares. While the Petroleum Division has agreed to the transfer, advocating for a direct transfer to the SWF, the PC has sought clarity on the legal route for the transfer process.
The matter was brought to the attention of the PC Board during a meeting held in December 2023, where it was resolved to seek approval from the CCoP for the transfer of the OGDCL shares to the Petroleum Division.
In the ensuing discussions at the CCoP, it was noted that while there is no explicit prohibition on transferring shares to the Petroleum Division, the prevailing practice involves transferring such shares to the SWF.
Given these considerations, the CCoP has decided to seek legal guidance from the Ministry of Law on the appropriate course of action. While the Petroleum Division favors a direct transfer to the SWF to streamline the process, the final decision rests on the legal interpretation provided by the Law Ministry.
This development underscores the complexity surrounding the transfer of OGDCL shares and reflects the government’s commitment to ensuring transparency and adherence to legal procedures in matters of privatization and asset management.
