Tightening rules: OCAC revises membership criteria after petrol crisis

Decides to not add new OMC unless it meets certain conditions.

KARACHI: The Oil Companies Advisory Council (OCAC) is revising its membership criteria and has stopped the addition of new members until the process is completed, a top official of the petroleum lobby told The Express Tribune.

The decision of not including any new oil marketing company (OMC) unless it meets certain conditions comes at a time when the industry is facing severe criticism for petrol shortage.

“At the moment, all I can say is that the members would have to meet certain ethical standards and fulfill the requirements of OCAC’s vision and mission statements,” said OCAC CEO Ilyas Fazil.

OCAC has 18 members including 12 OMCs, five refineries and a pipeline company. At least five OMCs are yet to invest in building a petroleum supply chain, which includes fuel stations and storage tanks.

The Oil and Gas Regulatory Authority (Ogra) has issued licences to a total of 21 OMCs. Except for seven of them, which are big players including Pakistan State Oil (PSO), Shell, Chevron, Attock, Admore, Total-Parco and Byco, the rest have no significant presence on the ground.

Industry officials say fresh marketing licences have been issued based on political considerations to sponsors who neither have the experience nor the financial muscle to undertake the petroleum marketing business.

This has also been cited to be one of the reasons for the weakening of OCAC as the downstream and midstream petroleum industry’s mouthpiece.

However, OCAC has nothing to do with the licensing requirements, Fazil said. “Ogra has its own requirements. We have completely separate criteria for members.”

He also admitted that OCAC has to play a more active role from now on. “We are also working towards improving communications with the public. Our website is being updated and soon we will share data related to petroleum products on a regular basis.”

Published in The Express Tribune, January 24^th,  2015.

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