Petroleum Division delays action on unauthorised ownership changes by energy companies

Despite issuing show-cause notices six months ago to energy companies for unauthorised changes in ownership and control, the Petroleum Division has yet to take any action. The case involves Spud Energy Limited and Frontier Holdings Limited, which offloaded their stakes without approval, breaching national regulations governing the energy sector, Dawn reported. 

The issue began in March 2025 when Phoenix Exploration sold a 73.3% stake in Jura Energy to IDL Investments Limited, a company registered in the British Virgin Islands. The transaction took place without prior approval from the relevant authorities, violating Pakistan’s petroleum regulations.

On July 18, 2025, the Director General of Petroleum Concessions (DGPC) issued a show-cause notice to the companies involved, stating that the transaction had not been disclosed or approved as required by law. 

Pakistan’s petroleum regulations mandate that companies holding petroleum rights disclose changes in shareholding, board appointments, capital issuance, and corporate structure.

The notice requests detailed documentation from Spud Energy, Frontier Holdings, and Jura Energy, including pre- and post-transaction shareholding structures, board appointments, transaction values, and tax filings. The companies were also asked to confirm whether capital gains or withholding taxes were paid in Pakistan. The notice warned that failure to comply could result in punitive action, including the revocation of petroleum rights.

Both companies acknowledge the unauthorised transaction. However, despite the DGPC’s authority under Rule 69(d) to suspend or revoke licenses in such cases, no enforcement action has been taken.

On October 16, 2025, the Islamabad High Court (IHC) issued a status quo order, preventing any alterations to the shareholding or control structure of Spud Energy and Frontier Holdings until further notice.