1. ENERGY POLICY DIALOGUE USPCAS-E UET PESHAWAR OIL & GAS KHYBER PAKHTUNKHWA OIL & GAS COMPANY LIMITED (KPOGCL) Raziuddin, CEO KPOGCL 4-Oct-2015

2. T HEME … Evolve Energy Policy via Dialogue wrt KP 1. Profound Impact on Socio-Economic development 2. Solutions for Energy Crisis Pakistan Energy Security Khyber Pakhtunkhwa Socio-Economic Cross-road of civilizations 25 Million People Great potential Natural Resources Human Resources 2

3. K HYBER P AKHTUNKHWA O IL /G AS P OTENTIAL The new Geological Frontier Producing more than 50% of indigenous crude oil Producing more than 15% of indigenous natural gas Producing more than 25% of indigenous LPG Out of 33 Exploration & Production Companies, 13 are working in Khyber Pakhtunkhwa. 10 TCF and 600 Million Barrels of Oil 3

4. P OLICY F RAMEWORK E NTAILS 1. Constitution 2. Amendments (18 th Amendment) 3. Sub-Legislations/Acts 4. Policies 5. Rules of Business 6. Fourth Schedule 7. Council of Common Interest CCI 8. Plans (Vision-2025, 11 th Five Year Plan) 9. Regulators 10. Policy Makers 4

5. C RUDE O IL P RODUCTION & U SE (P AKISTAN E NERGY Y EAR B OOK 2014) 5

6. N ATURAL G AS P RODUCTION (P AKISTAN E NERGY Y EAR B OOK 2014) 6

7. KP P RODUCTION F ORECASTING O F O IL 7

8. KP P RODUCTION F ORECASTING O F G AS 8

9. KP P RODUCTION F ORECASTING LPG 9

10. C ONSTITUTION Article 158 ‘’ The Province in which a wellhead of natural gas is situated shall have precedence over other parts of Pakistan in meeting the requirements from the well- head.’’ Article: 172 (iii) ‘ ’Subject to the existing commitments and obligations, mineral oil and natural gas within the Province or the territorial waters adjacent thereto shall vest jointly and equally in that Province and the Federal Government ’’ 10

11. C ONSTITUTION Article: 161 1. Notwithstanding the provisions of Article 78; a. the net proceeds of the Federal duty of excise on natural gas levied at well- head and collected by the Federal Government, and of the royalty collected by the Federal Government, shall not form part of the Federal Consolidated Fund and shall be paid to the Province in which the well- head of natural gas is situated.’’ a. the net proceeds of the Federal duty of excise on Oil levied at well-head and collected by the Federal Government, shall not form part of the Federal Consolidated Fund and shall be paid to the Province in which the well-head of oil is situated. 11

12. P OLICIES Petroleum Policy 2012 (Federal) Petroleum Rules 2013 (Federal) Shale Gas Policy Draft Tight Gas Policy 2013 (Federal) LPG Policy 2015 Draft (Federal) Dynamics keep changing New policy every 3 to 4 years International Research needed to develop an attractive policy 12

13. P OLICY M AKING FOR KP Objectives Get rid of Load Shedding misery (Electricity & Gas) Attract Industries by giving un-interruptible and cheap power and gas supplies Ways and Means for KP to Achieve Objectives 1. Inundate the market with fuels (Supply-side Economics) 2. Deregulate the market 3. Provincial Government to take lead in oil and gas Exploration & Production, refining, gas infrastructure and LPG plants 4. Capacity Building 13

14. T ARGETS FOR KP 2025 1. Per capita Consumption target 4000 koe (National 3500 koe) 2. 900 mmcfd gas to industries 3. Connect 80% of Population with gas 4. Fertilizer Plant 750,000 TPA 5. Refinery 100,000 bpd 6. Thermal Power Plants 2 x 800 MW (GE 9FB) 7. FDI of US$ 10 Billion 8. National investment of US$ 3 Billion 9. Peshawar Stock Exchange 14

15. D EVELOP FOR KP KP Vision-2025 KP 5 year Plans Establishment of KP-OGRA Academia, industries, businesses to join in development alongside the Government of Khyber Pakhtunkhwa Policies for Up-mid-down streams International Showcasing 15

16. KP O IL /G AS P OLICIES 2016 N EEDED 1. Research for competing Policies in the region 2. Interact with stakeholders 3. KP Petroleum Policy 2016 (Article 172-3) 1. Conventional 2. Tight Gas 3. Shale Gas 4. KP Petroleum Rules 2016 5. KP LPG Policy 2016 (Article 158) 1. Production incentives 2. Use efficiency 6. KP Gas Policy 2016 (Article 158) 1. Production incentives 2. Use efficiency 7. Market the Policies 16

17. KHYBER PAKHTUNKHWA OIL & GAS COMPANY LIMITED (KPOGCL) Thanks Q&A Razi Uddin (Razi) CEO KP Oil & Gas Company Ltd. (KPOGCL) www.kpogcl.com.pk Cell +92 300 500 1038, +92 333 538 0240 Phone: +92 91 5615142-48 Fax: +92 91 5615149 Email: razi.ceo@kpogcl.com.pkrazi.ceo@kpogcl.com.pk Peshawar, Khyber Pakhtunkhwa PAKISTAN 17

18. C ONTINUE … Article: 157 ‘’Provided that the Federal Government shall, prior to taking a decision to construct or cause to be constructed, hydro-electric power stations in any Province, shall consult the Provincial Government concerned’’ ‘’In case of any dispute between the Federal Government and a Provincial Government in respect of any matter under this Article, any of the said Governments may move the Council of Common Interests for resolution of the dispute’’ 18