In the wake of $5 billion investment, the govt has introduced a new petroleum exploration policy. What does it do? 

ISLAMABAD: A controversial document prepared by the Petroleum Division has created a stir regarding the future of international investment into Exploration and Production (E&P) in Pakistan.

The document, which is a framework for how Exploration and Production investment in Pakistan would be handled, has made amendments to an initial petroleum exploration policy that the government had passed back in 2012. The new amendments are coming after international investors recently announced an investment of $5 billion into the sector. 

The investment in question

Local and international firms, in a meeting held in the first week of July 2024 under the chair of Prime Minister Shehbaz Sharif, announced an investment of $5 billion during the next three years in Pakistan’s oil and gas exploration and production sector. A delegation from the sector informed the meeting that around 240 potential reserve sites would be excavated with the investment of $5 billion to explore petroleum and gas.

The delegation claimed during the meeting that this investment will increase the country’s local production of oil and gas as currently daily production of petroleum is 70,998 barrels and gas 3,131 MMcfd.

The Governor State Bank of Pakistan (SBP) informed the meeting that on the special instructions of the prime minister, all the remittances of these oil and gas exploration and production companies, on account of profit, have been sent to their countries.

The policy change

The instruction from Prime Minister Shehbaz Sharif was clear: Make exploration and production easy for foreign investors. But what has taken place since then?