Interim order: Top court unblocks OGDCL selloff

Allows govt to sell the company’s 10% shares

ISLAMABAD:

In an interim order issued on Monday, the Supreme Court gave the government the green-light to carry out the privatisation of the Oil and Gas Development Company Limited (OGDCL).

Ending weeks of legal wrangling, the court also directed the government to transfer the proceeds from the auction to the federal consolidated fund, barring it from utilising the auction money until the final verdict was announced.

A three-member bench of the apex court, headed by Chief Justice Nasirul Mulk was hearing the government’s petition challenging the Peshawar High Court’s order, restraining the federal government from going ahead with the sale of 10 per cent shares of OGDCL.

During the proceedings, the bench also issued notice to all provinces to deliberate over matters related to control over their mineral resources after the passage of the 18th amendment.

Attorney General (AG) Salman Butt informed the court that the federal government is a major stakeholder in the company.

After the 18th Amendment, the provincial and the federal governments have equal share in the oil and natural gas and resources, he pointed out.



The AG informed the court that the Council of Common Interest had given the green light for the company’s privatisation in 1997.

Advancing his arguments during the proceedings, Waseem Sajjad, who was representing the Khyber-Pakhtunkhwa (K-P) government, urged the court to restrain the federation from selling its stakes in the company, as the provincial government was not consulted.

The chief justice questioned the lawyer over the K-P government’s delay in challenging the federation’s decision to go ahead with the auction, which was initiated in April this year.

The judge also quizzed Sajjad over the mechanism of equal distribution of natural resources.

Responding to questions, the lawyer proposed provincial boards that develop the mechanism of equal shares.

Subsequently, notices in this regard have also been issued to the concerned parties by the court and the hearing of the case has been adjourned for three weeks.

Earlier, in a concise statement submitted before the court, the federal government said that if the privatisation of 10% shares of the OGDCL was not completed, Pakistan would be exposed to ‘great financial loss’.  The government alleged that the K-P government is attempting to create an impression of a national economic crisis.

Since the PHC passed the restraining order earlier this month, the value of OGDCL’s share has depreciated by about Rs20, it added.

“If this uncertainty continues, there is great likelihood that the share value will further depreciate. The loss already suffered on this account runs into 100s of millions of rupees.”

Criticising the K-P government, the statement said that the federal government bears the responsibility of framing economic policies for Pakistan, adding that provincial government fails to appreciate that the debt liability of foreign banks and entities is the federal government’s responsibility.

Published in The Express Tribune, October 21^st, 2014.