ISLAMABAD: The Shell Pakistan Limited (SPL) paid on Tuesday Rs10 million penalty imposed by the Oil and Gas Regulatory Authority (Ogra) for June 25 oil transportation accident near Ahmedpur East leading to deaths of over 215 people.

The payment was immediately rejected by the regulator, saying it was partial compliance of its order that also required the oil marketing company (OMC) to pay compensation to families of the victims at a rate Rs1 million for the deceased and Rs0.5 million to the injured.

“This is only a partial compliance and we reject it,” said a spokesperson to the regulator, Imran Ghaznavi.

He said that the payment of penalty would not be considered full compliance with its orders unless the oil company made full compensation to affected families within the stipulated deadline i.e. until Wednesday.

“Ogra will proceed under the rules and laws in case the company fails to ensure full compensation to affected families,” he said.

Another official explained that Ogra had powers under the law to impose Rs1 million per day of additional fine for non-compliance of its orders or revoke the marketing licence.

Earlier, the SPL said it would pay the fine imposed by Ogra to comply with the regulator’s directive. “However, we do so while reserving the right to contest the fine,” the SPL said, adding that the matter was under investigation, and the company would decide on the appropriate course of action once more information was known and investigations concluded.

The company said while it “did not accept liability” it clearly recognised that this was a tragedy that had deeply affected the community as the holy month of Ramazan ended.

“Therefore, as an extension of our early and ongoing humanitarian efforts to secure medical aid for the injured and provide food and other relief to the impacted families, Shell Pakistan Limited will make the payment requested by Ogra,” it said.

It said that it was discussing with Ogra the appropriate means by which this financial assistance can appropriately reach the injured and the families who have lost their loved ones and will continue to work with various aid agencies to provide immediate relief, and work with relevant authorities to identify recipients and ensure that the above assistance reached the people affected.

“We also look forward to working with the regulators, emergency services and the wider oil and gas industry to improve safety standards and address any gaps between industry practice and regulatory standards,” the SPL said.

On July 7, Ogra had held SPL squarely responsible for gross violation of laws, rules and standards in oil transportation resulting in June 25 tragic accident near Ahmadpur East.

Published in Dawn, July 12th, 2017