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Category: Energy

You can go through stories related to energy. The stories are about changes in petroleum prices and updates on energy sector of Pakistan and world.

  • Tax exemption granted to transmission line projects set up till June 2022

    Tax exemption granted to transmission line projects set up till June 2022

    ISLAMABAD: A time period for setting up transmission line projects has been extended for four years up to June 30, 2022 in order to allow 10-year tax exemption on profit and gains derived by a taxpayer from such projects.

    The amendment has been made to clause 126M of Second Schedule to Income Tax Ordinance, 2001 through Tax Laws (Amendment) Ordinance, 2021.

    Earlier, income tax exemption was granted to those projects which were set up on or after June 30, 2018. However, with the amendment the time for setting up projects has been extended up to June 30, 2022.

    The text of the clause is:

    “(126M) Profits and gains derived by a taxpayer from a transmission line project set up in Pakistan on or after the1st day of July, 2015 for a period of ten years. The exemption under this clause shall apply to such project which is—

    (a) owned and managed by a company formed for operating the said project and registered under the Companies Ordinance, 1984 (XLVII of1984), and having its registered office in Pakistan;

    (b) not formed by the splitting up, or the reconstruction or reconstitution, of a business already in existence or by transfer to a new business of any machinery or plant used in a business which was being carried on in Pakistan at any time before the commencement of the new business; and

    (c) owned by a company fifty per cent of whose shares are not held by the Federal Government or Provincial Government or a Local Government or which is not controlled by the Federal Government or a Provincial Government or a Local Government.

  • Prices of petroleum products kept unchanged

    Prices of petroleum products kept unchanged

    ISLAMABAD: The federal government has decided to keep the prices of petroleum products unchanged for next fortnight.

    According to a statement issued on Monday, the government has decided not to change the prices of petroleum products for next fortnight.

    The prices as of February 01, 2021 remain effective for the rest of the month.

    The government on January 31, 2021 announced raise in petroleum prices. Following prices were increased and effective from February 01, 2021:

    The price of petrol has been increased by Rs2.70 per liter to Rs111.90 from previous rate of Rs109.20.

    The rate of high speed diesel has been enhanced by Rs2.88 per liter to Rs116.07 from Rs113.19.

    The price of kerosene oil has been increased by Rs3.54 per liter to Rs80.19 from Rs76.65.

    The rate of light diesel oil has been increased by Rs3.00 per liter to Rs79.23 from Rs76.23.

    The new prices of petroleum products are applicable from mid night February 01, 2021.

  • Engro Powergen, CPPAL enter into binding agreement

    Engro Powergen, CPPAL enter into binding agreement

    KARACHI: Engro Powergen Qadirpur Limited (EPQL) and Central Power Purchasing Agency (Guarantee) Limited (CPPAL) have entered into binding agreement for the fixation of power purchase rate and release of outstanding amount to the Independent Power Producer (IPP), a statement said on Monday.

    The EPQL shared a communication with the Pakistan Stock Exchange (PSX) informing that on August 17, 2020, it had announced to enter into a Memorandum of Understanding (MoU) dated August 12, 2020 with Committee for negotiations with Independent Private Power Producers notified by the Government of Pakistan, in line with the understanding reached in the MOU, EPQL and Central Power Purchasing Agency (Guarantee) Limited (CPPAL).

    The parties will now enter into a binding agreement based on the terms of the MOU, which include inter alia: that all undisputed outstanding amounts due and payable to EPQL under the power purchase agreement, as on November 30, 2020,will be paid in two instalments (each instalment comprising of one-third cash and two-thirds government issued PIBs and Sukuks).

    Further, in the larger national interest, EPQL has agreed to (prospectively) accept a reduction in the tariff component, whereby the Return on Equity (“RoE”) and the Return on Equity During Construction (“RoEDC”) will be fixed at 17 percent per annum in PKR (on NEPRA approved equity at Commercial Operation Date for RoE and RoEDC, calculated at USD/PKR exchange rate of PKR 148/USD, with no future USD indexation (“Revised ROE and ROEDC”).

    However, the existing RoE and RoEDC, together with the applicable indexations, shall continue to be applied until the date when the applicable exchange rate under the present Tariff reaches PKR 168/USD 1 (i.e. the date of the signing of the MoU), whereupon the Revised RoE and RoEDC shall become applicable and shall apply for the remainder of the Term of the power purchase agreement.

    Upon notification of Tariff Determination by NEPRA, first instalment of 40 percent shall be paid to EPQL and the remaining 60 percent shall be paid within six months after the date of the first installment.

  • Petroleum levy collection registers 100 percent increase

    Petroleum levy collection registers 100 percent increase

    ISLAMABAD: The collection of petroleum levy has registered almost 100 percent increase during the first half of the current fiscal year, according to official statistics made available on Saturday.

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  • Agha Steel to install 2.25MW solar power project

    Agha Steel to install 2.25MW solar power project

    KARACHI: Agha Steel Industries has signed a contract with Renewable Power Pvt. Ltd. for installing a 2.25 Megawatt solar power project at its production facility located at Port Qasim Karachi, a statement said on Wednesday.

    Meezan Bank Ltd is the banking partner for this transaction. This would be among one of the largest solar power projects installed by a steel manufacturer in Pakistan.

    According to a statement this project will initiate a Green Steel Revolution at Agha Steel Industries by helping in sustainability of its energy mix and at the same time reducing the burden on national grid. The 2.25 Megawatt solar power project would also reduce the carbon emission by 46,000 tons in a lifespan of 20 years.

    This solar power plant, being installed on the self-consumption basis, will produce around 3.3 million units of clean and renewable electricity every year, which will result in a significant drop in the carbon footprint of Agha Steel Industries. The company is currently undergoing an expansion to increase its rebar capacity to 650,000 from current 250,000 tons per.

  • ECC approves renewal of gas supply agreement between SSGC, Fauji Fertilizer

    ECC approves renewal of gas supply agreement between SSGC, Fauji Fertilizer

    ISLAMABAD: The Economic Coordination Committee (ECC) of the cabinet on Wednesday approved the renewal agreement of gas supply between Sui Southern Gas Company (SSGC) and Fauji Fertilizer Bin Qasim Limited.

    Federal Minister for Finance and Revenue, Dr. Abdul Hafeez Shaikh, chaired the meeting of the ECC of the Cabinet.

    Federal Minister for Planning, Development and Special Initiatives Asad Umar, Federal Minister for Interior Sheikh Rasheed Ahmad, Minister for Privatization Muhammad Mian Soomro, Adviser to the PM on Institutional Reforms and Austerity Dr. Ishrat Hussain, SAPM on Revenue Dr. Waqar Masood, SAPM on Power Tabish Gauhar, SAPM on Petroleum Nadeem Babar and Federal Minister for Energy Omar Ayub Khan participated in the meeting.

    Petroleum Division placed a summary before ECC regarding renewal of Gas supply Agreement (GAS) between Sui Southern Gas Company Limited and Fauji Fertilizer Bin Qasim Limited.

    After detailed discussion, the ECC approved with a condition that renewal would be allowed on “as and when available basis” for a period of 05 years. SSGCL may restore the gas supplies to M/S Fauji Fertilizer till December, 2021 or until a uniform rate for the whole fertilizer sector is formulated after rationalization of tariffs (whichever is earlier).

    The ECC considered and approved another summary by the Petroleum Division for re-allocation of gas from Saqib-1A Well located in District Ghotki, Sindh Province to M/S Sui Southern Gas Company Limited from its previous allocation to SNGPL (as approved earlier by the ECC dated 06-10-2009). The price of gas will be as per the applicable Petroleum policy.

    Petroleum Division also moved a summary for removal of Dividend Distribution cap on Mari Gas Company Limited (MPCL) under Gas Pricing Agreement as the company is being considered for privatization.

    After due deliberation, the ECC allowed that the dividend distribution cap may be removed to ensure that the divestment transaction generates optimum sale proceeds for the Government.

    The Committee further decided that MPCL would ensure dividend distribution in accordance with the Provisions of Companies Act, 2017 and the Companies (Distribution of Dividends) Regulations, 2017.

    On the recommendation of the Ministry of Housing and Works, the ECC allowed the Ministry to utilize its own funds equal to Rs. 377.21 million for renewal of lease of Garden West (Pakistan Quarters), Karachi.

    The following Technical Supplementary Grants (TSGs) were approved by the ECC:

    a) Rs. 141.308 million to Ministry of Information and Broadcasting for an expenditure incurred on media campaigns to create awareness among public during COVID-19 pandemic.

    b) Rs. 9.025 million to Ministry of Information and Broadcasting for a media campaign on occasion of Kashmir Solidarity Day – 05 Feb. 2021.

    c) Rs. 5 million for purchase of spare parts for helicopter maintenance by HQs Pakistan Rangers (Punjab).

    d) Rs. 25 million for purchase of spare parts for helicopter maintenance by HQs Frontier Corps Balochistan (South).

    e) Rs. 10 million for repair and maintenance of helicopter by HQs Frontier Corps KP (South), D.I.Khan.

  • Sales of petroleum products grow by 9 percent in seven months

    Sales of petroleum products grow by 9 percent in seven months

    KARACHI: The sales of petroleum products have posted a 9 percent growth during the first seven months of the current fiscal year mainly due to increasing economic activities and trade.

    The sales of oil market companies (OMCs) increased to 11,269,000 tons during July – January of 2020/2021 as compared with 10,309,000 tons in the corresponding period of the last fiscal year, showing an increase of 9 percent.

    Analysts at Taurus Securities attributed the increase in sales of POL products to increasing economic activity and trade compared to last year as well as the government’s efforts at reducing sale of HSD in the black market.

    The sale of furnace oil posted a 36 percent growth to 1,915,000 tons during the first seven months of the current fiscal year as compared with 1,413,000 tons in the corresponding period of the last fiscal year.

    The analysts attributed the significant increase to the shortage for LNG and demand for furnace oil by the power sector.

    The analysts said that on the contrary, POL sales registered a decline of 5 percent Month on Month (MoM). The demand for high speed diesel (HSD) and motor spirit wavered on a MoM basis, down 13 percent and 5 percent, respectively, as economic and construction activity decelerated during winters.

    The sales of Pakistan State Oil (PSO) for the month posted a drop of 4 percent wherein Year on Year (YoY) sales increased by 12 percent.

    APL’s sales increased 5 percent MoM mainly due to growth in FO sales by 38 percent YoY. 1MFY21 sales declined 2 percent.

  • Hubco initiates agreement with Central Power Purchasing Agency

    Hubco initiates agreement with Central Power Purchasing Agency

    KARACHI: The Hub Power Company Limited (Hubco) on Tuesday said that it has initiated agreement with Central Power Purchasing Agency (Guarantee) Limited (power purchaser) in furtherance of the Memorandum of Understanding dated August 21, 2020.

    In a communication sent to Pakistan Stock Exchange (PSX), the company said that under the agreement, the payment of overdue receivables is an integral part of the agreement and the payment mechanism envisaged is two instalments, with 40 percent of the overdue receivables payable within 30 business days of signing the Agreement (comprising 1/3rd cash and 2/3rd financial instruments of PIBs and Sukuks) and the remaining 60 percent payable 6 months thereafter through the same method as that of the first instalment.

    In addition, payment of all invoices will be made in order of its submission so that invoices that have been outstanding the longest (in whole or in part) shall be paid first.

    At the request of the Government of Pakistan, in the larger national interest and sectoral sustainability, the Parties have agreed to reduce the existing Fixed Operating Costs Element by 11 percent, whilst keeping the existing arrangement of indexations.

    At the same time, the Parties have agreed to discontinue the US$ Exchange rate and US CPI indexation on the Project Company Equity and fix the same on National Bank of Pakistan’s TT/OD selling PKR/USD exchange rate prevailing as on August 21, 2020 and US CPI for the month of August 2020; till the current exchange rate reaches that of August 21, 2020 i.e. PKR 168.60/USD, the existing arrangement under Power Purchase Agreement (PPA) for the current half year shall apply for future billing.

    The parties have also agreed to engage without delay, on signing of the Agreement, in good faith negotiations and discussion and use their best endeavors to achieve pre-mature termination of the PPA, which will be mutually beneficial, resulting in compensation to the Company, while saving GOP substantial sums in lieu of capacity payments till the expiry of the Power Purchase Agreement (PPA).

    In parallel, the Parties have also agreed that certain outstanding dispute(s) shall be resolved through arbitration under the PPA. The terms of the Agreement are subject to approval of the Board of Directors of Hubco, the Federal Cabinet and execution of a final binding agreement.

  • OGDCL announces gas discovery at Sial-1 Well in Sindh

    OGDCL announces gas discovery at Sial-1 Well in Sindh

    KARACHI – The Oil and Gas Development Company Limited (OGDCL) has announced a significant discovery of gas condensate from its Sial-1 exploratory well located in the Hyderabad district of Sindh. This development marks a notable milestone in the company’s ongoing drive to enhance domestic hydrocarbon exploration.

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  • Hascol Petroleum BOD approves authorized share capital increase to Rs50 billion

    Hascol Petroleum BOD approves authorized share capital increase to Rs50 billion

    KARACHI: The board of directors of Hascol Petroleum Limited has approved increase in authorized share capital of the company to Rs50 billion from Rs10 billion, according to a communication sent to Pakistan Stock Exchange (PSX) on Monday.

    The communication said that at an emergent meeting of the board of director (BOD) of Hascol Petroleum Limited held on January 29, 2021, the board of directors approved the increase in the authorized share capital of the company from Rs10 billion to Rs50 billion, subject to obtaining the requisite approvals from the shareholders of the company, and in that respect to call and hold an extraordinary general meeting of the company on February 23, 2021 to obtain the approval of the shareholders/members of the company for the increase in the authorized share capital of the company and the corresponding amendments to the memorandum and articles of association of the company.