Qatar agrees to buy OGDCL, PPL shares

ISLAMABAD: Qatar has reportedly agreed to consider Pakistan’s offer to buy shares/ stakes of Oil and Gas Development Company Limited (OGDCL) and Pakistan Petroleum Limited (PPL) and sell Mirage-2000 fighter aircrafts to Pakistan.

This was revealed at a recent inter-ministerial meeting presided over by Special Assistant to Prime Minister on Coordination, Syed Tariq Fatemi as a follow up of Prime Minister’s visit to Qatar on 22-23 August 2022.

The Finance Minister during his recent visit to Qatar offered the Qatari side to buy stakes/ shares of OGDCL and PPL. The Qatari side agreed to consider and continue further negotiations on the proposal.

During the recent meeting with the Prime Minister the Ambassador of Qatar stated that Qatar is ready to provide Mirage-2000 fighter aircraft to Pakistan. He further stated that a formal request may be made by the Prime Minister of Pakistan for the subject matter. Same was reiterated by the Ambassador during his meeting with Additional Secretary Middle East, MoFA.

Pakistan has requested Qatar for a third contract of Liquefied Natural Gas (LNG) for two more cargoes monthly but the latter is seeking details of reforms taken by Islamabad. Pakistan is importing LNG from Qatar under two different contracts signed by Pakistan Muslim League-Nawaz (PML-N) Government and PTI Government.

According to sources, Prime Minister during his visit to Qatar had requested for another contract for two more LNG cargoes monthly. Minister for Finance, Ishaq Dar, who recently visited Qatar, also raised this issue.

During the inter-ministerial meeting, it was noted that CEO PARCO and MD SSGCL have been assigned to engage with Qatari side. Meeting/ interaction has not yet taken place. The meeting decided that progress would be communicated to MoFA and SAPM (Coordination).

On solar power project, Government had decided that it would be through competitive bidding. Solar power policy has been formulated on this basis. Nepra has also confirmed the benchmark tariff and next step is open bidding. Price discovery would be ready by end of April after which engagements with other governments (Qatar, UAE, and KSA) on G2G basis can take place.

Power Division had recommended that the cost of land for the project should be factored into the tariff but Nepra did not agree. The finances for cost of the land would have to be arranged although it was not a huge sum compared to the project size.

SAPM emphasized importance of the solar projects and asked Power Division to send written comments/ report on issues.

On acquisition of Islamabad and Karachi airports, the meeting was informed that Qatari side noted that they are only interested if it includes Aeronautical Income (which is major part of airports’ income).

Any attempts to only lease the retail areas and real estate development will have little chance of success. QIA requested to include Lahore airport in the deal. Agencies have concerns about Lahore airport which is in a dual use.

Qatar also requested to provide initial PIA financial and operational data at the earliest. During the meeting of Finance Minister with CEO of QIA, Qatar expressed desire to acquire Islamabad and Karachi airports first and informed that matter of Lahore airport may be dealt with at a later stage.

The sources said, as instructed by the Prime Minister, Public Private Partnership (PPP) options are being discussed with IFIs, which have been hired to determine the modalities/ structure of the proposed transaction for each of the three airports. On the basis of that Aviation Division would coordinate further with Qatar side.

SAPM stressed that this was an important and potential area for investment. He asked the Aviation Division to share a written report on the matter especially highlighting issues it faces.

Sharing details about acquisition of two LNG power plants by Qatar Investment Authority (QIA), Power Division noted that Gas Sales Agreement (GSA) was an issue and has been resolved. Debt re-profiling still has to be worked out by Finance Ministry.

However, on the acquisition of two RLNG power plants, Haveli Bahadur Shah and Balloki, Finance Ministry informed that an exercise to address issues related to the balance sheet of NPPMCL is under way at Finance Division. Additionally, G2G framework, intergovernmental commercial transaction Act has been enacted.

During discussion on Q terminal (bulk cargo handling capability), Ministry of Maritime Affairs informed that Q terminal will soon be concluding the deal with KPT for building terminals at Karachi port for receiving bulk cargo/ LNG. Finalization of the deal is awaited from the concerned Ministry.

Finance Minister, during his recent visit to Qatar, informed the Qatar side about steps taken by the Government of Pakistan for facilitation of G2G agreements. Qatari side informed that they prefer open bidding to bring transparency in the process of investing in Pakistani ports.

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