Pakistan Observer

OGRA’s performance

Feroz Khan

Wednesday, August 03, 2011 - Regulatory bodies were set up in Pakistan in early 2000s as part of the economic reform program of the Government to regulate public sector utilities, generally characterized as ‘natural monopolies’. In other words, natural gas, oil and power sector consumers are considered as captive consumers, since they are at the mercy of public sector natural monopolies in the absence of competition in these sectors.

Back then, the Government of Pakistan (GoP) decided to separate policy matters, ownership and regulatory functions. This was done to promote effective regulation while entrusting policy matters with GoP, thereby eliminating conflict of interest and ensuring enhanced efficiency of public sector utilities. Accordingly, Natural Gas Regulatory Authority (NGRA) was set up in line with best international practices adopted in different parts of the world. Subsequently, Oil & Gas Regulatory Authority (OGRA) was established in 2002 and NGRA was subsumed in OGRA. The main objective behind setting up OGRA was to encourage competition, increase private investment and ownership in the midstream and downstream (transmission and distribution) petroleum and gas industry, protect the public interest while respecting individual rights and provide effective regulations.

With each concrete action, OGRA has proved that it has remained committed towards the very principles on which it was established. The OGRA management is well aware of the fact that a consistency between short-term organizational goals and actions and long-term strategy and pursuit for transparency are essential ingredients for its enduring success story.

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