The four provinces have requested the government to make Directorate General of Petroleum Concession (DGPC) an independent body for solution of upstream oil/gas related issues, it was learnt Wednesday.
This was discussed during recent high-level meetings between the World Bank and the Petroleum Ministry aimed at restructuring DGPC and unbundling of Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL).
Sources said the Petroleum Ministry high-ups agreed on the suggestion forwarded by the DGPC for taking decisions related to natural gas/oil in Council of Common Interests (CCI) where provinces have representation and not in the Economic Co-ordination Committee of the Cabinet (ECC) where provinces have no representation.
Sources also said that on the directions of CCI the relevant departments held five separate meetings at the Ministry Inter-Provincial Co-ordination (IPC) to come up with consensus recommendations.
Official sources who attended the meeting said that after the passage of 18th constitutional amendment the provinces had become the main stakeholders in oil/gas and other natural resources.
DGPC being the regulator of upstream gas/oil sector needed to be restructured to give required representation to federating units, the official added.
Four provincial directors are appointed at DGPC but resolution of their salaries matters took almost one year, which is now temporarily decided, official said.
Provinces after the passage of 18th constitutional amendment wanted equal rights in distribution, exploration and transportation of natural gas and crude oil, but they have no required infrastructure, the official added.
Official sources said that the government in consultation with the federating units was considering establishing one gas transportation company and 13 regional gas distribution companies.
Regional gas distribution companies will help reduce Unaccounted for Gas Losses (UfG), better bill recovery and better services to consumers,” the official maintained.
The provinces in principle, have agreed to unbundling of gas utilities, but have asked the federal government to give them full control over the distribution and exploration of gas as per article 158 of the Constitution.
The federal government does not agree with the provinces for creation of their own oil/gas distribution and transportation companies, saying that it will take long time, however, federal government supports the idea of divisional gas distribution companies to smoothly run the gas distribution relating issues.
According to officials, the SNGPL which operates in Khyber Pakhtunkhawa, Punjab and AJK will be divided into eight regional gas distribution companies while SSGCL which has operations in Sindh and Balochistan is planned to be divided into five distribution companies. -Business Recorder