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Thursday Aug 29 2019

New LNG policy to be announced next month, working to remove red-tapeism: Nadeem Babar

ISLAMABAD: Prime Minister Imran Khan's special assistant on petroleum, Nadeem Babar, said Thursday a new policy on liquefied natural gas (LNG) would be announced next month.

Speaking alongside the PM's special assistant on information and broadcasting, Dr Firdous Ashiq Awan, and Power and Petroleum Minister Omar Ayub Khan, Babar said tax relaxation would be provided on the upgradation of old refineries and installation of new ones. What was done in three years previously would now be completed in one, he added.

He said one petrol pump would require 17-25 approvals earlier in the refining and marketing sector but, now, only six to seven steps — including approvals from the Environment Protection Agency (EPA), Oil and Gas Regulatory Authority (OGRA) and the Explosive Department —were were necessary.

Babar said the sector was divided into five key areas, including oil and gas exploration and production (E&P), refining and marketing, pipelines and gas distribution, liquefied petroleum gas (LPG), and liquefied natural gas (LNG).

Five new international companies given the green signal to set up LNG terminals, he said.

As many as 27 new exploration blocks had been identified after a detailed survey in potential areas of hydrocarbon reserves, for which international auction process would be initiated in December this year and completed in three rounds, he added.

For some small and old fields where extraction had been halted due to high cost, the government now planned to give incentives to boost domestic production instead of importing LNG at a higher rate.

The SAPM said three oil refineries, out of five existing ones, were inefficient and the government had announced a 10-year tax exemption for them to increase their capacity. The given concession would also be applicable for new deep conversion oil refineries, he added.

He said some policy changes had been made to facilitate new companies in the E&P sector, wherein 10 of the 24-30 unnecessary steps required to obtain approval for drilling activities had been removed.

There will be a certain time-limit for approval at each step, and if no response was given, the case would be moved to the next stage automatically, he added.

'More and more job opportunities'

Moreover, the government would start a gas awareness campaign in September while announcing a road map to ease doing businesses in petroleum sector. 

He said the government's aim was to put an end to bureaucratic red-tapeism — in line with the premier's directives a day prior to do so to bolster business opportunities in Pakistan.

The SAPM spoke of removing red-tapism in getting approval for making investment and advancements in different fields and said PM Imran had been briefed about the measures being taken to make the petroleum sector vibrant and attractive for investors.

Babar, however, said there had been no efforts in the last decade or two to resolve existing problems. Rather — and unfortunately — new laws and regulations were introduced to create temporary solutions, which, in the long-run, had ended up creating hurdles in the petroleum sector activities.

He said the petroleum division, as per the PM's vision, had devised a prudent strategy that would help attract local and foreign investments.

"Increased investment will ultimately create more and more job opportunities," Babar said, adding that the petroleum division was working on a two-pronged strategy to bring policy reforms and introduce a plan to pave a more convenient way to do business.

The SAPM said policy reforms, however, would take some time as formal approval was required from relevant authorities. The strategy to make starting businesses convenient, on the other hand, could be implemented instantly.

Mobile app and web portal

Under the strategy, Babar said, new players would come in the petroleum sector and the inefficient ones would have to quit. An environment of competition would be ensured, ending the monopoly of individuals, he added.

He also commented on people voicing concerns about receiving bills the day before the due date. In that regard, he said the bills would now be delivered in 48 hours and there would be a 15-day period before the due date. This system had been agreed in principle but would take one to two months for implementation, he added.

The SAPM said a mobile app and web portal would also be launched to facilitate gas consumes to lodge their complaints. It would be operated using the consumer's identity number.

Babar said a campaign would be launched in September to create awareness among consumers about conservation of gas and avoid excessive billing during the peak winter season. The consumers would be informed on gas consumption of geysers and heaters in 24 hours, he added.

He explained that the campaign would help consumers install efficient appliances and equipment to conserve gas.

Operation against Rs3bn transformer mafia

Separately, Ayub, the minister for petroleum, said any officer found charging extra — or off-the-paper money — for replacing or repairing transformers would be removed from their job. In the past six months, 40 million cubic feet per day (mmcfd) had been added to the gas system, he added, which, in turn, would translate into no gas load-shedding in winters.

The minister said effective measures were being taken to boost business and investment in Pakistan and that the petroleum ministry would lead the initiative to bolster business growth in the country.

Load management on 80 percent of the 8,789 feeders at present had been cleared, he said, adding, however, that load management was still being carried out in Bannu Peshawar Circle — or Peshawar Electric Supply Company (PESCO), as well as Hyderabad Electric Supply Company (HESCO), Sukkur Electric Supply Company (SEPCO), and Multan Electric Supply Company (MEPCO).

Those 1,200 feeders were yet to be cleared of the load management, he said.

The minister noted that an operation had been conducted against a transformer mafia worth Rs3 billion. Whenever there would be a complaint from now on, there would be action, he warned.

In response to a question about electricity rate, the minister said fuel adjustment charges would be determined as per international market practice.

Commenting on the utility bills' instalments, he said it was the domain of respective superintendent, engineer, sub divisional officer, and Xen to decide the requests of billing instalments.