Mari Gas scraps new office plan

Company to return money spent on purchase of land.

Zafar Bhutta May 13, 2011


The board of directors of Mari Gas Company Limited (MGCL) has scrapped plans to construct a new head office in the Defence Housing Authority (DHA) Rawalpindi after the Oil and Gas Regulatory Authority (Ogra) declared the purchase of land as ‘irregular’.

The Ministry of Petroleum had directed MGCL to return the money paid for the land to the government immediately. “However, the MGCL management did not pay back the money and instead requested the government to wait till the price of land rises, which will enable the company to recover full cost,” a source said.

Earlier, in a meeting held on September 28, 2009, the MGCL board had approved a plan for the construction of a new head office in DHA at a cost of Rs1.3 billion, declaring its existing head office in Islamabad a security risk. The existing head office, constructed 10 years ago, is located at G-10/4.

Furthermore, the MGCL management had also purchased two plots at high prices adjacent to the existing building for expansion. Sources maintained that funds for the existing building and for the new plots were provided by the federal government out of provincial receipts (the gas development surcharge).

Sources maintained that the plot in DHA Rawalpindi was bought at high rates and the company might not be able to recover full cost of the plot.

Ogra in its decision on MGCL wellhead gas price for financial year 2010-11 had observed that the petroleum ministry had turned down the company’s request for the construction of a new head office in DHA. Ogra had also termed the purchase of land irregular since it had been bought without prior approval of the petroleum ministry.

Fauji Foundation, Government of Pakistan, Oil and Gas Development Company and general public have 40, 20, 20 and 20 per cent shares respectively in MGCL.

Published in The Express Tribune, May 14th, 2011.


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