PESHAWAR, Sept 8: The NWFP government has constituted a committee to work out modalities for setting up a new department for exploiting energy resources, including hydropower, oil and gas, in the province.The committee headed by the additional chief secretary has been assigned the task to propose a name as well as work scope for the proposed department, an official told Dawn.

The planning and development department recently floated the idea of creating a separate entity for looking after NWFP’s energy resources, including hydropower, oil and gas.

The concept behind creation of a full-fledged department would consolidate efforts for exploitation of energy resources, which was still a neglected area in terms of institutional mechanism, the official said.

The NWFP has immense potential of hydropower production and the government can easily generate 28,000MW electricity by setting up small hydel stations at various places. Of this, only 3,945MW has been exploited mainly because of lack of a pragmatic approach.

The provincial government, at the moment, has the Sarhad Hydel Development Organisation, which was created in 1986 to develop small-scale hydropower projects.

The government could not achieve any major breakthrough because output of that entity only confined to preparation of a few feasibility studies and construction of a few small power units in northern parts of the province, the official said.

Apart from developed infrastructure, he said, the provincial government also did not have a proper entity to work out and reconcile royalty payable on account of hydropower profit by Wapda to the province. At present, a small section of the finance department is responsible for the same.

A number of hydropower projects are under construction and on completion, working out royalty-related issues will be needed for which the government does not have a mechanism, and the proposed department will undertake this obligation.

Apart from hydel power generation, the NWFP also have huge deposits of oil and gas in its southern parts, including Kohat and Karak districts, which could be another avenue for resource mobilisation for the cash-strapped provincial government.

The Frontier government, for instance, fetched Rs487.271 million on account of royalty in 2004-05, which reached Rs4.15 billion last financial year. In the current fiscal year, estimates suggest collection of Rs4.429 billion that is expected to be surpassed.

Currently, around 225,591 square-kilometre area is under exploration of oil and gas across the country, of which 11,396 square-kilometre area, i.e. 5.1 per cent of the total, is in NWFP.

Despite having such huge potential and advantages, the official said, the provincial government had no organisation to look after and oversee ongoing development in this important area, as only the Oil and Gas Development Corporation and the Ministry of Petroleum undertook this job.

The provincial government had no idea and role in managing things in the areas of oil and gas because it only depended on royalty paid by the federal government for its overall production, the official said, adding: “The new department can also look after this area.”