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NAB swings into action on Customs Today’s story, starts proceeding against DGPC
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NAB swings into action on Customs Today’s story, starts proceeding against DGPC

ISLAMABAD: National Accountability Bureau (NAB) has initiated probe against Petroleum Division’s Director General Petroleum Concession (DGPC) Imran Ahmed for causing delay in injecting 30 Million Cubic Feet per Day (MMCFD) gas of Badin IV South Gas Fields into the country’s gas transmission system, Customs Today has learnt.
Following to a news story of Customs Today, NAB has swung into action and sought complete details from DGPC pertain to delay in injecting 30 MMCFD gas of Badin IV South Gas Fields into the main gas system of the country which allegedly caused $ around $50 million loss to national exchequer.
According to document, the NAB has sought complete details (date of award till date) from the Director General Petroleum Concession (DGPC) Imran Ahmed regarding Badin IV South Gas Fields under the provisions of Section 19 and 27 of National Accountability Ordinance, 1999.
The NAB has also asked DGCPC to provide complete correspondence on Badin IV South Gas Fields along with noting portion including the noting of the Secretary Petroleum till date. Similarly, NAB has asked to provide reasons with relevant documents if the gas of Badin IV South Gas Fields is not included in the national grid (gas system). Moreover, NAB has asked to provide complete details of all other wells which are successful but could not be included in the national transmission along with reasons,” NAB sought in its letter dated 16th January 2019 to DGPC.
As per document, NAB has been conducting inquiry under the provisions of NAO, 1999 on allegation of causing loss to national exchequer and misuse of authority by public office holders, public functionaries of Ministry of Petroleum & Natural Resources, DGPC, OGDCL and others in the matters of production of gas, undue benefit to M/s EETPL, UFG (Unaccounted for Gas) issues and illegal appointments.
Sources privy to the matter informed Customs Today that Pakistan has allegedly suffered a loss of $50 million due to the “inefficiency and incompetence” of DPGC Imran Ahmed as the department (Directorate General Petroleum Concession) delayed the signing of an important agreement for more than six months after the discovery of 30MMCFD gas from Badin IV South Gas Fields. They said that the government has been importing expensive Liquefied Natural Gas (LNG) which costs $10/MMBTU (Million British Thermal Unit) and it (Government) has to pay around $50 million from its foreign reserves during the said period ostensibly due to shortage of gas in the country.
“DGPC allegedly involved in facilitating LNG import at the cost of national exchequer,” said sources.
Sharing details of delay in injecting the gas of Badin IV South Gas Fields into the country’s main gas system, the sources said that the Exploration & Production (E & P) company, which had spudded the gas fields earlier, has claimed additional premium of $0.25 per MMBTU for the gas of Badin IV South Gas Fields under the Marginal/Standard Gas Fields-Gas Pricing Criteria and Guidelines, 2013. However, DGPC has so far refused to give said additional premium ($0.25 per MMBTU) to the E&P companies namely PEL, FHL of Canada and GPXP of Kuwait which have made $60 million investment in the block for production of gas. They said a third party who was earlier nominated by DGPC to examine the fields has repeatedly informed that the gas fields were marginal in nature and recommended that price of gas for Badin IV South Gas Fields should be set in accordance with Marginal/Standard Gas Fields-Gas Pricing Criteria and Guidelines, 2013.
DGPC is concealing and distorting facts to hinder the addition of this cheap gas into the system in order to facilitate the import of more expensive LNG imports, sources earlier alleged and added that DGPC’s actions have deprived the government and the locals of earning money in this crucial time, sources maintained.
According to sources, “As soon as gas is discovered in an area, numerous job opportunities emerge for the locals. Those who own land in the area, rent it out at profitable rates. The gas-producing province earns 12.5 per cent in head royalty while the government earns 17 per cent in GST. The exploration and production company has to pay corporate tax as well. All of these factors contribute to the national economy. DGPC’s actions deprived the government and the locals of making money in this crucial time,” sources alleged.
“After the deduction of all taxes, the price of local gas usually stands at $4/MMBTU. The government has been importing expensive Liquefied Natural Gas (LNG) which costs $10/MMBTU and has paid around $50 million from its foreign reserves.”
It is pertinent to mention that Badin IV South Gas Fields have been ready to produce and inject 30 MMCFD of high-quality gas into the SSGCL (Sui Southern Gas Company Limited) system since June 2019, while IPR International Energy Group had inspected the gas field and declared the field to be marginal in nature and recommended that the price should be $6.3/MMBTU in accordance with the Gas Pricing Criteria and Guidelines, 2013. However, DGPC raised objections on its report and asked the firm to inspect the field once again. The results were the same this time as well. So far, the only pending matter remained the approval of marginal price incentive for Badin fields by DGPC in accordance with guidelines.