February 28, 2006	Tuesday	Muharram 29, 1427

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ISLAMABAD, Feb 27: The Lahore High Court (LHC) Rawalpindi bench on Monday suspended the orders of the chief executive officer (CEO) of Oil and Gas Development Corporation (OGDC) pertaining to cancellation of contract of a private exploration company.

Justice Mohammad Muzammal Khan, after hearing the arguments of the petitioner’s counsel, immediately suspended the cancellation orders issued by the CEO Raziuddin and directed him to submit parawise comments within a week.

The OGDC had signed an agreement with a private oil exploration company, Lubgas, under which the firm was given the contract of Dakni Oil Fields (Jand) for a period of 15 years — from 1989 to 2004 — to explore liquefied petroleum gas (LPG) in the area.

The owner of the private firm invested millions of rupees in the exploration work but the yield of gas from the locality was far less than expected. This resulted in a row between the government body and the private company.

Taking into account the huge investment by Lubgas, the corporation extended its contract period for another five years up to 2009 in order to compensate the private firm for the losses it suffered due to low production.

But the incumbent OGDC head cancelled the contract on February 21, 2006 without any prior notice or intimation to the other party.

Lubgas moved the superior courts against the cancellation of its contract. Senior lawyer Abdul Baseer Qureshi is pursuing the case. The court took up the case on Monday and heard the petitioner’s counsel.

Advocate Qureshi argued before the court that the cancellation order was illegal, unconstitutional, one-sided and unjustified. The company owner has spent huge amount of money on exploration work and the contract period extends up to 2009, he argued.

No notice was served on the company nor was it given an opportunity to explain its position, he said, pleading that the cancellation order was one-sided and therefore had no legal effect.

After hearing the arguments, the judge issued suspension orders of the cancellation of contract and served a notice on the OGDC’s chief executive officer to submit parawise comments within a week.