Petroleum blocks to provinces: government asked to devolve concession authority

The KP government has asked the federal government to devolve concession authority over petroleum blocks to provincial governments, sources said. Sources maintained that the provincial government is accusing Directorate General of Petroleum Concessions (DGPC) of delaying the grant of concessions for blocks located in KP, which after the 18th Amendment to the Constitution should legally be awarded by the provincial government.
Recently, the KP government attempted to delegate these powers to the KP secretary energy and power; however the federal government has refused to accept the demand, sources said. Sources said that the KP government demarcated seven blocks including Lakki, DI Khan East, DI Khan West, Nowshera, Khushal, Charsadda and Miran for petroleum exploration, but the DGPC has yet to award permits.
In November 2017, Mohammad Raziuddin, CEO Khyber Pakhtunkhwa Oil & Gas Company Limited (KPOGCL), alleged that the federation has proposed Pakistan Petroleum Exploration and Development Authority, after a lapse of seven years since the 18th amendment was passed, and it would place all oil and gas regulatory matters under the federal government and the provinces will get nothing. He claimed that the federal government's stance on the critical issue is still to have all upstream regulations and becoming the sole regulator, rolling back the 18th amendment.
Sources said that the KP government has further contended that the disadvantages of the federal government's stance are that not a single block has been offered to bidding since 2014 out of 35 pending blocks, the leases awarded before 2012 have also expired and are not being renewed, loss of more than Rs 20 billion to the federal government in terms of royalties has already been incurred, whereas the KP has lost Rs 5.8 billion in one year in the form of royalty due to lower production.
The province further suggested that the proposed Pakistan Petroleum Exploration and Development Authority should only be authorized to regulate pricing and concession management of offshore, FATA, Azad Jammu & Kashmir, and Gilgit-Baltistan, and its chairman should be appointed on rotation basis between federation and the four provinces. The provinces should have their own regulatory authorities for concession management.