'Balochistan to get Rs 1 Bln per annum more in Royalty'
Pakistan Times Monitoring Report

ISLAMABAD: Balochistan will get an additional amount of Rs 1 billion per year under royalty and Gas Development Surcharge (GDS) head after implementation of Senator Dilawar Abbas formula that is based on gas production.

“All amounts, presently being collected under the GDS and royalty heads, will be clubbed in a single account to be divided among the provinces based on their respective production,” the sources said while referring to Dilawar Abbas formula.

The provincial governments, the sources further disclosed, would be bound to spend 20 per cent of the amount they receive under the GDS and gas royalty on the development of areas from where gas is explored by the companies.

Under the formula, Sindh and Punjab would lose a little amount they are presently receiving in regard with the GDS and gas royalty, and ultimately this amount will go to Balochistan.

Chaudhry Shujat Hussain

PML President Chaudhry Shujat Hussain, in his speech in National Assembly, had claimed that a consensus has been achieved on 27 out of 31 recommendations of the sub-committee headed by Syed Mushahid Hussain Syed. These 27 recommendations also include Dilawar Abbas formula.

Gas Development Surcharge

Senator Dilawar Abbas said the GDS (gas development surcharge) and royalty formula is prepared in consultation with not only the parliamentarians but also the Ministry of Petroleum and Natural Resources.

Dilawar Abbas maintained that the provincial governments would be bound to utilize at least 20 per cent of their gas royalty and GDS share at the specific area from where it is explored.

“This step is taken in view of mitigating the sufferings of the locals.”

Besides, the gas exploration companies, he said, will be asked under new agreements to ensure provision of social amenities in the area rather confining these facilities only to their colonies.

“Agreement will be signed with the exploration companies for provision of these facilities,” he said.

The ruling party senator, an active member of Mushahid’s committee, said presently Sindh province is producing 60 per cent whereas Balochistan is generating over 30 per cent of total gas available in the country.

Accumulation of the GDS and royalty amount and then its distribution on the basis of production would help Balochistan province to receive over one billion rupees more than what it is receiving presently.

Dilawar Abbas said under the reopened arrangements, the two gas fields namely Sui and Khankot, the well-head price will increase from presently Rs 47 MMCF to Rs 70 MMCF by the June 2006-07.●