Ogra faces turmoil after member resigns amid pricing probe

ISLAMABAD: The Oil and Gas Regulatory Authority is facing a period of disruption after one of its three members resigned in the middle of an investigation into price differential claims, while the government has also moved to place civil servants in key positions at the regulator.

Ogra member (oil) Zainul Abideen Qureshi stepped down after being questioned by the Federal Investigation Agency in Karachi over disputed payments made to an oil marketing company under price differential claims linked to subsidised oil pricing following the US-Iran war.

The FIA had identified misreporting of oil stocks and sales that apparently enabled pricing-related gains, resulting in reportedly Rs14 billion in questionable claims. While Go Petroleum obtained a stay order from the Sindh High Court against the FIA inquiry, the federal government separately set up a committee to scrutinise the integrity of the payments made under the PDC mechanism.

Probe and resignation

The committee, is headed by an additional secretary of the Ministry of Finance and includes senior officials from the petroleum division, the Federal Board of Revenue, the auditor general’s office and Ogra. The purpose of the body is to carry out a detailed examination of the price differential claim payments.

The FIA also questioned Mr Qureshi and Director (Oil) General Imran Ahmad in separate sessions that lasted more than 72 hours. Mr Qureshi defended the broader oil pricing and PDC reconciliation framework during the process, but submitted his resignation after returning to Islamabad last week.

Appointments under legal challenge

At the same time, the government has inducted at least three officers from the former district management group, now called the Pakistan Administrative Service, into Ogra without legal cover. On April 8, Secretary Establishment Nabeel Ahmed Awan was appointed Ogra chairman for a three-month term.

The chairman’s post had been vacant for about 18 months, although no new appointment was made during that period for reasons described as unknown. Under the Ogra law, the vice chairman assumes charge when the chairman’s office is vacant. Ogra member gas Shahzad Iqbal had taken over the position, but the government later denotified him in the middle of oil supply arrangements linked to the Gulf conflict.

Mr Awan’s appointment has been challenged in the Islamabad High Court. Despite that, he brought in two more officers on deputation last week: BS-20 officer Majid Mohsin Panhwar and BS-18 officer Imran Ali Sultan.

Law change under consideration

The cabinet committee on legislative cases has already cleared proposed amendments to the Ogra law to allow BS-21 and BS-22 officers to be appointed chairman for four years, with the possibility of one extension. The proposed changes would also permit the deputation of other civil servants to support the chairman.

These amendments may be introduced through a presidential ordinance before the budget session later this week, ahead of possible court scrutiny of the matter.