The News reported that Exploration and Production companies would be offered USD 4.08 per mmbtu in as per 2009 petroleum policy, which was USD 3.65 per mmbtu in 2007 and USD 2.99 per mmbtu in 2001 petroleum policy.

Dr Asim Hussain unveiled this while formally announcing the Petroleum Policy 2009.

Dr Hussian said that “The policy is aimed at ensuring higher rate of returns to Exploration and Production companies. Lucrative incentives have been offered in the Petroleum Policy 2009 to attract maximum foreign investments.”

Dr Asim Hussain said that it would meet the future challenges of the energy demand and encouraged foreign investment. He said that “The government will take benefit from the expertise of local and foreign oil and gas exploration companies to meet the growing energy demand in the country.”

He added that the government has set a target of drilling 100 new oil and gas exploratory wells during the year 2009 to meet the country’s growing energy demand.

Dr Hussian said that presently about 45 rigs are producing and supplying oil and gas across the country. The E&P companies would pay 12.5 % royalty and 40% income tax to the government. The disputed biddable Gas Price Gradient factor had been eliminated in the new policy.

He added that the ministry has so far awarded 119 exploration licenses to public and private sectors, while 100 new licenses with more incentives would be awarded under the new petroleum policy to local and foreign investors.

Commenting on oil and gas production of the country, he said the gas production was 3.9 billion cubic feet per day and the oil production is 66,000 barrels per day against the demand of 9 to 10 barrels cubic feet per day of gas and 77,000 barrels per day of oil.

The last petroleum policy was drafted in 2007 by a foreign consultant but the industry had strong objections to this policy which is why no exploration license had been granted for more than 2 years in the past.

source: Steel Guru

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