Oil firms flout laws, workshop told

Published January 31, 2008

HYDERABAD, Jan 30 Speakers at a workshop have accused the multinational companies engaged in oil and gas exploration in Sindh of violating international norms and local agreements.

They demanded formation of monitoring committees at district level, comprising elected representatives and civil society members, to ensure implementation of international covenants and agreements signed with the government.

The media workshop was held at the local press club on Tuesday on the topic of “Social responsibilities of oil and gas companies working in Sindh”. It was organised by the Participatory Development Initiatives (PDI) in collaboration with Oxfam.

The speakers, including Sikandar Brohi, Ishaq Soomro, Zain Daudpoto and Hyderabad Press Club president Khalid Khokhar, said that Sindh produced bulk of the country's oil and gas production but the people of the districts producing gas and oil were living in abject poverty and facing environmental hazards.

They said that oil and gas companies working in Sindh were not only openly violating the international business rules but also local laws and agreements.

They claimed that according to “petroleum concession agreement” signed by these companies with the government, 12 per cent of the production had to be paid as royalty to the oil or gas producing district through district government but the royalty was not being paid to the majority of the districts.

They said that the companies also had to spend between $50,000 and $700,000 every year in social development of their areas but they did not do so.

They said that the companies after launching production paid huge amount to the federal government as production bonus which under the rules had to be spent on development of oil and gas producing areas but nobody knew where that amount had gone.

They said that according to law, local people had to be trained and employed by the companies but this law was also being violated.

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