January 31, 2003	Friday	Ziqa’ad 27, 1423

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ISLAMABAD, Jan 30: President Gen Pervez Musharraf has sought a comprehensive report on all kinds of petroleum-related payments to Balochistan government and Baloch Sardars, including royalties, rentals and illegal gratifications.

The ministry of petroleum and natural resources has been directed to also brief him about the deliberations of two different committees that interacted with Baloch sardars during last three years to open prospective petroleum areas to the waiting companies.

Informed sources told Dawn that the interior ministry would also coordinate with the petroleum ministry to prepare a report and give a presentation to the president before he leaves for Moscow next week. The presentation is expected to be made to him on Saturday or Sunday, the source said.

The presentation, said the sources, would cover payments made by the federal government, various public sector companies like the Oil and Gas Development Company Limited (OGDCL), the Pakistan Petroleum Limited (PPL), the Sui Southern Gas Company Limited (SSGCL) and the Sui Northern Gas Pipelines Limited (SNGPL) during the last three decades and the results the government achieved in return for these payments.

The payments include royalties to Balochistan made under the Constitution, rental to the local people and tribal leaders against the use of land and, in some cases, other payments in the form of illegal gratifications.

Petroleum ministry sources said the president would also be informed about some recent cheques, around Rs2.6 million, as rentals that could not be paid to the Bugtis as they were demanding surcharge on this amount for the late payment.

President Musharraf had constituted a ministerial committee, comprising former ministers for interior and petroleum, soon after assuming power in October 1999 to hold negotiations with Balochs to enable more than 20 companies to start exploration activities in the province.

The committee was later dissolved and replaced by another committee, led by chief secretary Balochistan and comprising heads of the OGDCL and the PPL and the director-general of the petroleum concessions.

The negotiation were moving in the right direction and most of the decisions were under implementation but suddenly something went wrong behind the scenes that resulted in collapse of talks between the government and Nawab Akbar Bugti in June last which later resulted in tension, said the sources.

“We are back to square one and the situation has rather deteriorated. Everything would have to be started afresh in the changed environment to rebuild confidence,” a source said, adding that over Rs350 million spent by the OGDCL alone also could not yield positive results.

Around 20 local and foreign petroleum exploration and development companies had declared political “force majeure” — a term used to hold in abeyance the work programme of exploration and development required under the agreement due to political and security reasons beyond investors’ control.

Nawab Bugti and the government had agreed in September 2001 that rocket attacks on the country’s two largest gas-producing fields, Sui and Uch, would not take place in future and Bugti tribesmen would also facilitate exploration activities.

In return, the state-owned exploration and production companies, the PPL and the OGDCL had agreed to recruit as many as 150 Bugtis at the Uch and Sui gas fields.

Besides, all other social welfare and uplift projects were to be routed through Nawab Bugti. Former petroleum minister Usman Aminuddin repeatedly said Balochistan area was highly prospective and exploration activities could lead to discoveries bigger than Sui field.

Private local and foreign companies had indicated to support social sector projects provided they were given security assurances. About 12 exploration blocks in Marri, Bugti and Mengal areas have been granted to local and foreign companies but no progress has been made, so far.