Senate Committee Seeks 20 Years of Oil and Gas Royalty Records from Provinces

A subcommittee of Pakistan's Senate Petroleum Committee has directed the Petroleum Ministry, the Oil and Gas Development Company Limited (OGDCL) and Sindh's finance and energy departments to submit detailed records of oil and gas royalty payments covering the past 20 years. The panel, chaired by Senator Jam Saifullah Dharejo, wants the documents presented at its next meeting as it examines whether producing provinces and local communities are receiving a fair share of resource revenue.

Members expressed dissatisfaction with figures supplied by OGDCL, which covered only a decade and did not connect royalty payments to actual production volumes. The subcommittee asked the company to provide annual production and royalty records dating back to 1995, when it began operations, so that payments can be cross-checked against output.

The panel also questioned why OGDCL is exempt from production bonuses. According to the company, the exemption covers certain fields developed between 1990 and 1993. A representative of the Directorate General of Petroleum Concessions (DGPC) said the exemption was limited to the Sinjhoro Block in Sanghar district under a 1997 concession agreement, indicating a disagreement over the scope of the relief.

On the payment mechanism, a DGPC official told the committee that royalties are deposited in a federal account at the National Bank of Pakistan. The Finance Division deducts 2 percent as collection charges before transferring the provincial share within 15 days. The official promised a detailed review of royalty payments made over the past 15 years. Senator Dharejo said production bonuses could help fund schools, hospitals and other public facilities in areas affected by extraction, stressing that residents should benefit from resources taken from their regions.

The subcommittee also called for local residents to be given preference in non-technical jobs on oil and gas projects in Tando Allahyar, and asked the Petroleum Ministry to clarify whether current rules require companies to reserve a set share of jobs for local people. Separately, Senator Qurat-ul-Ain Marri criticised Sui Southern Gas Company (SSGC) for not consulting elected representatives on a proposed pipeline serving 31 villages near the Gobi field; the utility's managing director said the project is awaiting federal funding.

The committee was also briefed on LPG adulteration. The Oil and Gas Regulatory Authority (OGRA) reported that an operation in Pano Akil uncovered illegal carbon dioxide installations, which were sealed and storage tanks confiscated. The proceedings reflect growing legislative scrutiny of how Pakistan's oil and gas wealth is accounted for and shared with the communities that host production.

The subcommittee's demands come amid wider debate over the fiscal relationship between the federation and provinces over natural resource revenues, an issue that has repeatedly surfaced in discussions of Sindh's energy-producing districts.