ISLAMABAD: The Prime Minister’s Office (PMO) has directed the Petroleum Division to submit within three days the details of the non-payment of royalties by two oil companies.

The complaint was lodged to the Prime Minister’s office by an NGO that two companies involved in oil and gas exploration are wilfully defaulting on their obligations to pay outstanding royalties amounting to Rs1.13 billion.

The complaint also highlighted that the Petroleum Division too was failing to recover the dues from the two companies -- Spud Energy and Frontier Holdings Ltd.

Meanwhile, responding to the query a senior official of the Petroleum Division said that both companies had been sent several notices by the Director General Petroleum Concession (DGPC). The last notice was served in February 2022.

Incidentally, the DGPC had also asked the buyers of oil and gas from these companies including Sui Southern Company (SSGCL), Pakistan Refinery and others to withhold payments, but it was turned down by the buyers because they were not authorised to collect government dues including royalties.

According to the details in the letter, Spud Energy owes nearly Rs835 million whereas Frontier Holdings Rs303m to the federal government but added that the amount could be higher as these companies have not been paying their various dues at several exploration blocks.

Published in Dawn, January 15th, 2023

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