PESHAWAR: The Peshawar High Court on Monday issued a stay order against the bidding for the issuance of exploration licence for a petroleum block in Wana area of South Waziristan tribal district and directed the federal government and its Directorate-General of Petroleum Concession to file comments on the petition challenging the ongoing licensing exercise.

The order was issued by a bench consisting of Justice Shakeel Ahmad and Justice Arshad Ali after preliminary hearing into the petition of the Khyber Pakhtunkhwa Oil and Gas Company Limited (KPOGCL).

The petitioner challenged the DGPC’s decision to sever 738 square kilometres area from the Wana Petroleum Block and merge it with the nearby Baska North Petroleum Block through a notification issued on Oct 25, 2021.

The petitioner claimed that the alteration of the size and shape of the highly prospective Wana Petroleum Block was contrary to the relevant provisions of the Constitution, rules and petroleum policy.

Petitioner challenges changes to petroleum block area’s size

He requested the court to declare illegal that notification as well as the inclusion of the altered Wana Petroleum Block in the Jan 2, 2022, advertisement, which invited bids for the grant of petroleum rights.

The bench adjourned the hearing directing the respondents, including the secretary for the ministry of energy, the DGPC through its director-general and provincial director, and Al-Haj Enterprises Private Limited to file their respective comments on the petition. It restrained them from awarding the block licence in the meantime.

Representing the petitioner, Barrister Asadul Mulk contended that following the Constitution (Eighteenth Amendment) Act, 2010, oil and gas finds featured at Serial No 2 of Part-II of the Federal Legislative List and so, under Article 154 of the Constitution, the Council of Common Interest (CCI) was to exercise supervision and control of oil and gas matters.

He added that the CCI had ‘formulated’ the Petroleum Policy, 2012, under which, the Khyber Pakhtunkhwa government had set up its own oil and gas company, Khyber Pakhtunkhwa Oil and Gas Company Limited (KPOGCL) and granted it the status of a provincial holding company.

Barrister Mulk said in 2019, the petitioner delineated the Wana Petroleum Block over 1744 square kilometers of land in Tank and South Waziristan districts.

He added that the petitioner later requested the DGPC through a letter on Aug 22, 2019, to include the Wana exploration licence in the next international bidding round and deposited a fee of Rs100,000 for the purpose.

The lawyer said the Wana Petroleum Block, in its original shape and size, was a compact block covering 1744 square kilometres of land and was considered to be a highly prospective block based on the newly emerged developments in the nearby blocks.

He said the DGPC issued the impugned notification on Oct 25, 2021, illegally revising the coordinates of Baska North Block and the compact Wana Block, while around 42 per cent of the original Wana Block was granted to the Al-Haj Enterprises Limited.

The counsel said an invitation to bid featuring the altered Wana Block at Serial No 1 was placed in a newspaper by the DGPC on Jan 2, 2022, inviting bids for the grant of petroleum and exploration rights for 14 blocks, including the revised Wana Block.

He contended that under Rule 4 of the Pakistan Onshore Petroleum Exploration and Production Rules, 2013, only the federal government was authorised to divide and re-organise areas into petroleum block.

The lawyer said the Supreme Court, in the Mustafa Impex case, had defined the federal government as the prime minister and his cabinet but in the instant case, the DGPC altered the shape of the Wana Petroleum Block without the approval of the federal cabinet.

He said Clause 1.3.6 of the petroleum policy mandated consultation with the provincial director at DGPC, but that exercise wasn’t carried out before the altering of the shape of the Wana Petroleum Block.

Additional advocate general Rabnawaz Khan and DGPC provincial director Mian Nasram Javed sought time for filing comments on the petition.

Published in Dawn, April 19th, 2022