CLARIFICATION
Petroleum Ministry contradicts report titled “Supreme Court to take up case against OGDC deal” Also Clarifies that Muslim Lakhani, Chairman, MESA Petroleum (Pvt) Ltd., has never been an employee of OGDC.
The News
Internet Edition
Friday, April 22, 2005
http://www.jang-group.com/thenews/apr2005-daily/22-04-2005/business/b18.htm
Business News
Clarification
LAHORE: The Director General Petroleum Concessions of the Ministry of Petroleum and Natural Resources, in a clarification on a story “SC to take up case against OGDC deal” against lease of Safed Koh published by The News on April 9, 2005, said the bid award process is completely transparent and all related information is available to the public.
The clarification has vehemently denied the allegation made therein to the extent of the award process and said it was totally incorrect.
Relinquishing the blocks on discoveries not being commercial and their re-bidding is a normal industry practice, which was followed diligently at the time of its award, the clarification said.
Scimitar being the only bidder, the block was accordingly awarded to them. The transfer of shares by one company to another also is a routine practice and is allowed after taking into account all legal requirements.
With reference to reporting of third year renewal without drilling of any well, the clarification said the factual position is that the company in addition to their contractual commitment of one exploratory well, which has already been drilled on 2-1-2005 and completed, has drilled another appraisal well on 10-4-2005. The renewal period will start from 18th April 2005 only, for which they have since submitted an application under the Pakistan Petroleum (Exploration and Production) Rules 2001/Petroleum Concession Agreement and is being processed accordingly.
(The news contents were taken from a petition filed in the Supreme Court of Pakistan by Syed Ehsan Ullah Waqas, who distributed the petition’s copies to press reporters and who also reproduced the contents in their own newspapers. The News published the story in a good faith and in the best interest of Pakistan without any ulterior motive or malicious intention or malaise against anyone. —Editor)
http://www.jang-group.com/thenews/apr2005-daily/22-04-2005/business/b18.htm
Pakistan Observer
Friday, April 22, 2005
Page# 08
Business & Finance
Petroleum Ministry Contradicts
Press report
ISLAMABAD –A spokesman of the Ministry of Petroleum & natural Resources has strongly contradicted a press report titled “ Supreme Court to take up case against OGDC deal. Terming the report as improper and misleading based on conjectural statements, the spokesman said, the daily earlier also printed a fabricated story on this matter in its issue of May 26, last to which the Ministry responded by issuing a clarification. The allegations made therein, to the extent of award process, are transparent and all related information was available to the public relinquishing the blocks on discoveries not being commercial and their re-bidding is a normal industry practice, which was followed diligently at the time of its award. Scimitar being the only bidder, the block was accordingly awarded to them. The transfer of shares by one company to another also is a routine practice and is allowed after taking into account all legal requirements. The reporting of third year renewal without drilling of any well is again incorrect. The factual position is that the company in addition to their contractual commitment of one exploratory well, which has already been drilled on 2-1-2005 and completed has drilled another appraisal well on 10-4-2005.The renewal period will start from April 18, only, for which they have since submitted an application under the Pakistan Petroleum (Exploration and Production) rules 2001 / Petroleum Concession Agreement and is being processed accordingly. It is worthwhile to mention that after issue of a detailed clarification earlier on, a paper of such repute should have re-verified the contents of the news item before publishing it again. It also stated that the gentlemen referred in the news item has never been an official of OGDC, the spokesman concluded.-APP
The Nation
Wednesday, April 20, 2005.
Page # 03
Business News
Petroleum Ministry Clarifies
ISLAMABAD (PR) – The Director General (Petroleum Concessions) of the Ministry of Petroleum and Natural Resources has clarified a report published in a section of Press titled MMA moves Supreme Court against lease of Safed Koh.
He said that allegation made therein, to the extent of the award process are vehemently denied being totally incorrect. The bid award process was completely transparent and all related information was available to the public. Relinquishing the blocks on discoveries not being commercial and their rebidding in normal industry practice, which was followed diligently at the time of hisaward. Scimitar being the only bidder, the block was accordingly awarded to them. The transfer of shares by one company to another also is a routine practice and is allowed after taking into account all legal requirements.
The reporting of third year renewal without drilling of any well is again incorrect. The factual position is that the company in addition to their contractual commitment of one exploratory well, which has already been drilled on 2-1-2005 and completed, has drilled another appraisal well on 10-4-2005. The renewal period have started from 18 April, 2005 only, for which they have since submitted an application under the Pakistan Petroleum ( Exploration and Production ( Rule 2001 / Petroleum Concessions Agreementnd is being processed accordingly.
The News
Internet Edition
Saturday, April 09, 2005
http://www.jang-group.com/thenews/apr2005-daily/09-04-2005/business/b10.htm
Business News
SC to take up case against OGDC deal
By our correspondent
LAHORE: Leading stock market scrip OGDC may receive a support as a local educationist and philanthropist Syed Ehsan Ullah Waqas has filed a petition for revoking Safed Koh exploration rights from a Canadian company.
The deal should have fetched at least $33 million instead of mere $0.55 million, which were earned by Government of Pakistan through this sale auction, contended the MMA member Punjab Assembly Ehsan Ullah Waqas through this constitutional petition filed before the Supreme Court (SC).
A SC bench is taking up this constitutional petition challenging the leasing deal of Safed Koh (Dera Ghazi Khan) exploration rights.
In the petition, which was filed through Barrsiter Abid Hassan Manto, Waqas has challenged the deal as of dubious and against the national interest saying that two already explored, dig and subsequently capped as reserve ‘wells’ of OGDC were not mentioned in the text of advertisement through which the bid were invited in international media for the lease auction of exploration right.
He contended that in 1974, the OGDC hit two natural gas reserves in the area (namely Rhodo II) but following the difficult access of at 12 Km from D G Khan inside the hilly areas, these wells were capped and kept as reserves. The same reserves were also mentioned in Pakistan Energy Year Book 2003 and declared as best case as of having 1129 BTU (British Thermal Unit) combustion capability, which is being sold at $2.40 MMBTU globally, as high priced natural gas. The same official document also estimated the price of this reserve at $33 million.
He contended that when inviting bids for grant of exploration rights in the areas on July 12, 2001, the director general petroleum and his staff in utter disregard of the fact did not mention the presence of these wells in the area which resulted in attracting only $0.35 million as auction proceeds.
Following this advertisement, Scimitar Hydrocarbons Company Ltd (80 per cent) joined hands with MESA Petroleum Exploration Private Ltd have these rights. Interestingly, Scimitar Hydrocarbon also submitted a work programme, which include geological studies as well as an optional re-entry into this area subject to the discovery of gas, which was a farce as they were already aware of presence of these wells in the area, he submitted.
Major share holder of local partner of this joint venture, was a former OGDC official Muslim Lakhani, who surrender his green passport and job some years ago. Therefore, he knew about the presence of these reserves and thus maneuvered the situation with the help of his former colleagues to muster the illegal financial benefits.
During the auctioning process, initially agreed money was $0.35 million which was later enhanced to $0.553 million for face saving and claiming the transparency and hoodwinking the masses as well as international gas companies.
Despite the fact that Petroleum Policy requires any such venture to have a local partner with 20 per cent share holding, Muslim Lakhani transferred his 20 per cent shares to another company Rally Energy Pakistan Ltd thus scimitar also become the subsidiary of his new company.
This company has claimed on its website that total value of these reserves may be $115 million (Rs6.699 billion).
Meanwhile, the license of the Muslim Lakhani’s company was renewed for third consecutive year despite the fact that he failed to drill or re-enter any already drilled well which was a pre-requisite.
It was prayed that to avoid heavy monetary losses to national exchequer, the Supreme Court should intervene and revoke the exploration rights and this segment of Koh Sufed should be re-auctioned to fetch the actual price to the national kitty. The SC is schedule to take up this case next week.
http://www.jang-group.com/thenews/apr2005-daily/09-04-2005/business/b10.htm
The Nation
The Nation on web
Saturday, April 09, 2005.
http://nation.com.pk/daily/apr-2005/9/bnews4.php
Business News
MMA moves SC against lease of Safed Koh
By Our Staff Reporter
LAHORE - The MMA leader, Syed Ehsanullah Waqas, MPA, has moved the Supreme Court against the leasing deal of Safed Koh (Dera Ghazi Khan) exploration rights.
In the petition, filed through Advocate Abid Hassan Manto, he has challenged the deal as dubious and against the national interest, saying that two already explored, dug and subsequently capped as reserve ‘wells’ of OGDC were not mentioned in the text of advertisement though the bids were invited in international media for the lease auction of exploration right.
He contended that in 1974, the OGDC had hit two natural gas reserves in the area (namely Rhodo II) but following the difficult access of the site at 12 Km from D G Khan in the hilly areas, these wells were capped and kept as reserves. The same reserves were also mentioned in Pakistan Energy Year Book 2003 and declared as best case, as of having 1129 BTU (British Thermal Unit) combustion capability, which is being sold at $ 2.40 MMBTU globally, as high priced natural gas. The same official document also estimated the price of this reserve at $ 33 million.
He contended that when inviting bids for grant of exploration rights in the areas on July 12, 2001, the director general petroleum and his staff, in utter disregard of the above facts did not mention the presence of these wells in the area, which resulted in attracting only $ 0.35 million as auction proceeds.
Following this advertisement, Scimitar Hydrocarbons Company Limited (80 per cent) joined hands with MESA Petroleum Exploration Private Limited to have these rights. Interestingly, Scimitar Hydrocarbon also submitted a work programme, which include geological studies as well as an optional re-entry into this area, subject to the discovery of gas which was a farce as they were already aware of presence of these wells in the area, he submitted.
Major share holder of local partner of this joint venture, was a former OGDC official Muslim Lakhani, who surrendered his green passport and the job some years back. Therefore, he knew about the presence of these reserves and thus manoeuvred the situation with the help of his former colleagues to muster the illegal financial benefits.
During the auctioning process, initially agreed money was $ 0.35 million which was later enhanced to $ 0.553 million for face saving and claiming the transparency and hoodwinking the masses as well as international gas companies.
Despite the fact that Petroleum Policy requires in such venture to have a local partner, with 20 per cent share-holding, Muslim Lakhani transferred his 20 per cent shares to another company Rally Energy Pakistan Limited, thus scimitar also become the subsidiary of his new company.
This company has claimed on its website that total value of these reserves may be $ 115 million (Rs 6.699 billion).
Meanwhile, the license of the Muslim Lakhani’s company has been renewed for third consecutive year despite the fact that he had failed to drill or re-enter any already drilled well which was a pre-requisite.
It was prayed that the to avoid any heavy monetary losses to national exchequer, the Supreme Court should intervene and revoke the exploration rights and this segment of Koh Sufed should be re auctioned to fetch the actual price to the national kitty.
The SC is schedule to take up this case in the week beginning from Monday, April 11, 2005.