Oil marketing companies (OMCs) have accused the Oil and Gas Regulatory Authority (OGRA) of disregarding its duty to settle issues in the oil sector.
In a letter to OGRA, the Oil Marketing Companies Association of Pakistan (OMAP) said the authority’s response to complaints has always been disappointing. Despite being empowered to manage the $35 billion oil industry, emerging OMCs felt helpless and trapped due to OGRA’s uncooperative and stiff-necked team, reported TheNews.
OMAP in its letter underlined the critical importance of addressing issues such as foreign exchange losses, price mechanism formula, OMC margin revision, Iranian fuel smuggling, and OMC license renewals.
The Association recognized the difficulties and challenges that regulatory organizations typically face but expressed concern over OGRA’s way of addressing issues. The letter claimed that the regulator transferred OMAP queries to other departments instead of doing it themselves.
The Association cited a recent letter of DG Oil, Ministry of Energy (Petroleum Division) in respect of margins (OMCs and dealers) which shall be exercisable by OGRA with effect from April 1, 2006. OMAP said that this letter demonstrated OGRA’s failure to exercise its authority by making another department handle it.
In response to the OMAP letter, OGRA said it understands the importance of fostering a collaborative environment for the petroleum industry. The regulator said it is fully committed to its role as a regulator and appreciates the importance of resolving issues such as FX losses adjustment, price mechanism formula, OMC margin revision, and Iranian fuel smuggling.
While it acknowledged OMAP’s concerns about earlier interactions, OGRA remarked that it was actively seeking to find effective solutions for the industry.
The regulator further acknowledged private investments and their role in supporting the petroleum sector.
