22 - 28, 2001
Offshore drilling policy announced
The federal cabinet has decided that the companies,
investing in the offshore exploration, will not be required to share
revenues from the oil and gas production, with the government till the
recovery of their cost.
The package of incentives for offshore exploration
of oil and gas, approved by the cabinet on Wednesday, provided that
the investors would initially recover cost (subject to recovery limit
of 85 per cent) and thereafter share revenues from oil and gas
production with the government.
This package would be available to all new as well
as existing licence holders for a period of five years.
Instead of flat 12.5 per cent royalty, a sliding
scale royalty with a holiday of initial four years, was introduced.
The corporate income tax was also reduced from 50 per cent to 40 per
cent of the profits. Import duties and taxes would be zero for
exploration and after the first commercial discovery the same would be
three per cent.
In order to promote the exploration in ultra deep
water, the offshore areas were divided into three zones — shallow,
deep and ultra-deep, for which following profit rates on oil/gas split
a) Shallow Zone is the offshore area covered
by well in shallower than 4000 meters and in less than 200 meters
water depth and government's profit oil/gas share varies from 10 per
cent to 80 per cent based on the accumulated production from a field.
b) Deep zone is the offshore area covered by
well in deeper than 4000 meters and/or in over 200 meters and less
than 1000 meters water depth for which government's profit on oil/gas
share varies from five per cent to 70 per cent based on the
accumulated production from a field.
c) Ultra-Deep Zone is the offshore area
covered by over 1000 meters water depth for which government's profit
oil/gas share varies from five per cent to 60 per cent based on the
accumulated production from a field.
9 million phutti bales make way into ginneries
Although, phutti arrival from fields into ginneries
remained slightly higher than the corresponding period of last year
but forthrightly flow (Jan 1 to 15) tapered further giving strong
indication that lesser crop has been left in fields for third picking.
According figures released by Pakistan Cotton
Ginners Association (PCGA) phutti arrival up to Jan 15, stood at 9.003
million bales or 3.28 per cent higher than a corresponding period of
last year when production stood at 8.717 million bales.
During the out-going fortnight (Jan 1 to 15) there
had been steep fall in arrival of phutti at 402,427 bales compared to
515,057 bales recorded during the same period last year. This
indicates that lesser phutti has been left in the fields for third and
However, cotton analysts continue to question the
crop size and are of a firm believe that it would not be larger than
the last year's when spinners with connivance of ginners "whisked
away" one million bales for evading sales tax.
The existing gap between annual sugar production
and consumption for this year has widen by 1.0 million tons due to
expected diversion of 17 million of sugarcane to the gur making
According to the Agriculture Ministry, because of
increased production of gur, which is in great demand in Afghanistan
and the Central Asian Republics, the country will be required to
import 1 million tons of sugar to meet its annual needs against the
earlier projection of 300,000 tons.
LCs for the import of 1.0 million tons sugar have
been opened with the State Bank of Pakistan upto December 15, out of
which 0.571 million has already arrived in the country.
The huge gap between sugar demand and production
was reported by the Agriculture Ministry in a report submitted to the
Economic Co-ordination Committee's sub-committee on sugar.
POF offers ventures
The business community of Islamic countries have
been invited to utilize surplus capacities of Pakistan Ordnance
Factories and enter into joint ventures for manufacturing defence
Lt Gen Abdul Qayyum on Tuesday said that as part of
the programme of the public sector to invite the business community to
get involved in the production of defence items in technical
collaboration with POF, the same could be carried out with Islamic
countries through the ICCI.
CNG conversion at high speed
With no apparent let up in the price-spiral of
petroleum, vehicle owners are making a beeline at more than 15 gas
stations in the city, for a switch over from petrol to gas, which will
provide them with around 50 per cent saving on fuel cost.
Oil marketing companies (OMCs) quote figures from
25 to 30 vehicles and even 70 vehicles visiting gas stations daily for
the installation of compressed natural gas (CNG) kits. On an average
about 5,000 to 7,000 vehicles, all over the country, in a month are
reported to be converting to gas fuel.
SMEDA signs MoU
Small and Medium Enterprise Development Authority (SMEDA)
on Tuesday signed an MoU with G77-Trade Information Network's (TIN) to
make an effective exposure of local SMEs in the global market.
The MoU was signed SMEDA chief executive Iqbal
Mustafa and G77 Chamber of Commerce and Industry official Dr William
Tiga Tita, who is chairman of Global Management Consortium-TIN.
Car plant in Sujawal
Dewan Farooqui Motors Limited (DFML) on Monday
commissioned its plant II at factory site in Sujawal, Thatta, for the
manufacturing of Hyundai and Kia vehicles.
The plant is equipped with body shop that utilizes
welding equipment with latest automatic jigs and fixtures, paint shop
with robots supplied by Durr-Behr Germany.