ISLAMABAD: A parliamentary committee expressed its displeasure at Oil and Gas Development Company (OGDCL) for charging LPG consumers more than recommended by Oil and Gas Regulatory Authority (OGRA) in spite of the matter being sub judice.
The Public Accounts Committee (PAC)’s sub-committee on Ministry of Energy (OGDCL & PPL) was chaired by Convener Committee Syed Naveed Qamar.
During audit of OGDCL for the Fiscal Year 2019-20, it was observed that the management collected Rs 4.599 billion pertaining to the period from 2016 to 2020 on account of signature bonus on sale of LPG. However, according to the LPG Policy, the management (OGDCL) was not authorised to charge signature bonus from buyers of LPG. Hence, the amount of Rs 4.5 billion charged by the OGDCL as signature bonus was inadmissible, according to the audit report.
Audit contended that OGDCL was charging signature bonus despite assurance given to the court that the applicant would not charge any more than maximum producer price as determined by the federal government and burden of the signature bonus shall under no circumstance be passed on to the consumers. Further, as per note 12.1.4 of OGDCL annual report 2025, the company recognized signature bonus of Rs 5.193 billion as income after decision of OGRA. “In their deviation, they (OGDCL) have categorized this as “other income,” which is neither authorized nor admissible”, the audit official said.
Naveed Qamar asked the management of OGDCL whether OGRAs claim was correct. If everyone starts acting as their own regulator, what is the need for a regulator at all, he observed.
In his ruling, he said that OGDCL must comply with OGRA; otherwise, it was an irregularity.” If you do something and OGRA says it’s wrong, Audit will not let you off the hook”, he said.
OGDCL went to court against the decision of OGRA and the case was pending adjudication in Islamabad High Court.
Managing Director OGDCL, Ahmed Hayat Lak contended, “The matter is sub judice, OGRA provided a mechanism that was essentially unimplementable”, adding that instead of a bidding process, they (OGRA) suggested that the contract should go to whoever gives the most “benefit” or discount to the consumer.
According to Para 3.4 of LPG Policy 2016, subject to the policy guidelines of the federal government, OGRA will regulate and notify prices of indigenous LPG including production price, margins of marketing and distribution companies, and consumers’ prices. Further, according to Para 9.2 of OGRA’s decision dated June 22, 2018, LPG producers in public or private sector cannot charge signature bonus as per LPG policy.
Copyright Business Recorder, 2026
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