ISLAMABAD: The Oil and Gas Development Company is facing difficulties in bringing more than 300mmcfd gas per day into the system because of litigation and security situation at its various fields.

The Senate Standing Committee on Petroleum was informed by the OGDC management on Thursday that the company was facing difficulty in producing 300mmcfd gas and 7,000 barrels crude a day because of litigations in courts.

Contractors, local people and frontmen of some smaller exploration companies have obtained more than 250 stay orders.

Officials of the petroleum ministry and OGDCL urged the Senate body to use its influence to find a way out of stay orders and court hearings.

They said the company was working in a difficult situation and its foreign consultants and joint venture partners were not allowed to visit fields because of security concerns.

The committee, headed by Senator Sabir Ali Baloch, was informed that 300mmcfd gas could generate enough power to end loadshedding in the country, but it was not possible to achieve at present. ‘One case (in court) takes one to two years to reach any settlement,’ the committee was informed.

Members of the committee were of the opinion that security situation could be improved if non-technical jobs were provided to local people.

‘The locals want small gains, but in return the company can save millions and move freely and safely in remote areas,’ Senator Abbas Khan Afridi said.

The committee was informed that security arrangements for oil and gas fields were maintained mostly by third-party contractors who hired ex-servicemen for security.

Senator Mahbat Khan Marri from Kholu district of Balochistan said that exploration companies should not repeat the Dera Bugti model under which only prominent personalities received benefits and the local community was ignored.

OGDC managing director Zahid Hussain said his company was suffering financially because of circular debt and about Rs49 billion struck with oil refineries and gas companies.

‘If these dues are not recovered OGDC will have no option but to approach banks for loans,’ he said, adding that the company would also not be able to announce dividend for its shareholders for the second quarter.

Mr Hussain said that OGDC and the petroleum ministry were preparing a formula to regularise all contract employees who had worked for the company for five years.

The committee was informed that OGDC would soon carry out a geophysics survey.

‘The middle Indus basin, near Badin, has been identified as most potential area for exploration of oil and gas, along with Potohar, Bannu, Kohat, upper Indus and lower Indus basins,’ Mr Hussain said.

The company also intended to initiate international operations in nine countries, including Libya, Sudan, Russia, Yemen, Oman and Algeria, he added.