ISLAMABAD, April 8: The government has decided to empower the Oil and Gas Regulatory Authority (Ogra) to regulate prices of petroleum products and reduce interest rate of 18 per cent being charged from Wapda on government loans.

Wapda Chairman Zulfiqar Ali Khan told a group of journalists here on Tuesday that the prime minister while presiding over a meeting on Monday had directed the authorities concerned that prices of oil and gas be examined by Ogra and interest rate on Wapda loans be reduced.

He said the interest rate charged from Wapda was higher than the current rate on such loans.

The premier has also directed the ministries of finance and water and power to sit together and resolve all outstanding issues including payment of Rs34 billion by the public sector departments, he said.

Zulfiqar Ali Khan said he did not demand that powers to review oil and gas prices be transferred to Ogra, but suggested that some body should examine these prices.

“It was not my demand, but the prime minister directed that the pricing mechanism of oil and gas should be examined by Ogra” he maintained.

Asked what would be the fate of Oil Marketing Advisory Committee when Ogra would examine oil and gas prices, he said this question should be asked from the petroleum ministry.

He said it should be investigated as to why the prices of gas, a local product, increased to Rs185 per MMBTU from Rs89 MMBTU.

He said research should also be conducted to identify factors that were instrumental to increasing oil prices more than a raise in the international market. Furnace oil prices in Pakistan have increased threefold as compared to global rates.

“We have apprised the prime minister that further reduction in losses will require huge investment in the system to improve transformation, transmission and distribution, including recovery of receivables amounting to Rs34 billion against the public sector entities,” he maintained.

He said the prime minister was happy to know that Wapda was going to electrify 3,500 villages. This number is higher than the average of last five years.

“We also want to provide 5,000 tube-wells,” Zulfiqar said, adding that Wapda had started a massive uplift plan and would spend Rs3.2 billion on different schemes against the normal funding of Rs500-600 million.

The prime minister, the Wapda chief said, was also happy to note that the projects like Ghazi Barotha Hydropower Project would be completed as per schedule as well as other such plans launched under the Vision 2005.

Mr Jamali was also informed about the telemetry system installed to monitor the water release on barrages to resolve differences among the provinces.

Replying to a question, he said a meeting was scheduled on Tuesday between the Ministry of Kashmir Affairs and Azad Kashmir to sign a formal pact for raising of Mangla dam, which has been postponed due to some reasons. After the agreement between the AJK and government of Pakistan, the construction will begin.

He said Wapda had furnace oil reserves for 11 days, but in view of a crisis in the Gulf, it had spent Rs3 billion borrowed to pay for 30-day reserves.