ISLAMABAD: The Petroleum Division has prepared a framework for the sale of up to 100 MMCFD gas by Exploration and Production (E&P) companies to third parties through open auctions. The summary, finalized following an inter-ministerial committee decision led by Deputy Prime Minister Ishaq Dar, will be submitted to the Executive Committee of the National Economic Council (ECNEC) for approval.
Initially approved by the Council of Common Interests (CCI) during the caretaker government of Anwar-ul-Haq Kakar, the framework permits E&P companies to sell up to 35% of their gas to third-party buyers through competitive bidding, while 65% will be allocated to Sui companies. This approach aims to liberalize the upstream gas sector, attract investment, and address liquidity issues affecting E&P companies.
The framework ensures that gas sold to third parties meets Oil and Gas Regulatory Authority (OGRA) standards, with pricing not below wellhead rates. Buyers must hold valid OGRA licenses and comply with relevant regulations. Preference will be given to buyers within the province of production.
The initiative seeks to resolve the Rs. 1.5 trillion outstanding dues owed by Sui companies to E&P firms and facilitate investments worth $5 billion in Pakistan’s energy sector. This effort underscores the government’s commitment to boosting energy security and fostering a competitive gas market.
Story by Mushtaq Ghumman | Wasim Iqbal
