Dr. Khwaja Ekram Prof. Dr. Khwaja Mohd Ekramuddin
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BY Muhammad Akram Khan Faridi
MOL Pakistan, a fully owned subsidiary of the MOL Group has been working in Pakistan since 1999. Currently, it is led by Mr Erno Liptak, Managing Director, who brought a wealth of international experience in exploration and production projects from across the globe to ensure that MOL Group achieves its desired position and long-term goals in Pakistan.MOL Pakistan presently produces Oil & Gas from TAL Block as the operator of the concession. It also holds concessions for Margala and Margala North Blocks and has recently acquired significant shares in the Karak block as non-operating partner which is considered as another promising prospect for the future discoveries. MOL Pakistan is always on the look for further investment opportunities in Exploration and Production (E & P) sector of Pakistan through involvement in further Exploration Blocks and acquisition of state owned upstream/downstream opportunities available for privatization. MOL Pakistan sincerely believes that its E & P skill inventory gathered over the period of time can positively contribute towards the self-sustainability of Pakistan’s energy needs.MOL Pakistan is committed and dedicated to the balanced integration of economic, environmental and social factors into its everyday business operations and to maximise long-term stakeholder value to safeguard its licence to operate. MOL Pakistan operates in a profitable, safe and an ethically acceptable way by paying due regard to its environmental and social responsibility.
MOL Group believes in responsibly supporting the communities within which it operates across the globe by taking genuine interest in establishing partnerships that can provide benefits to local communities.
In line with this policy, MOL quickly responded to the catastrophic October 8th, 2005 earthquake and earmarked a sum of more than US$500,000 to help alleviate the sufferings of its victims. This sum was contributed to the President’s Relief Fund, and was used to establish a tent village in cooperation with the National Commission for Human Development (NCHD), to sponsor two visits by a specialist Rescue Team with disinfectants and decontamination equipment (the equipment later being donated to the Capital Development Authority) and to pay for the construction of MOL City at Havelian (Abottabad) – 40 houses to provide proper shelter to the then homeless families.
Again, when the horrendous monsoon rains and ensuing floods hit Pakistan in 2006, MOL Group was quick to respond with an immediate provision of basic food supplies and tents for the distressed to the value of US$20,000.
Besides these two major efforts, MOL seeks to promote on-going development of local communities. It has undertaken various community development projects in the Tal Block, such as the construction of basic health facilities at Gurguri and Makori in District Karak and construction of Examination Hall and Toilet Facility Complex in Govt. High school for Boys at Gurguri, moreover, up-gradation and provision of furniture for Government Boys’ & Girls’ Schools in Chechina-Hangu, Kahi-Darsamand, Doaba-Chorlucky, Tolanj and Gurguri as well as the Boys’ Colleges at Kohat and Hangu.
MOL Group also spent a huge amount in provision of portable water to the villages falling in D&P lease area of the TAL Block. So far besides test bores based on ERS survey at Gurguri and Urbashi, water supply schemes for Tehsil Headquarter Hospital BD Shah and Sam Banda have been completed while those for Adam Banda, Sharqi Banda and Gurguri are in progress.
Currently, MOL is managing the reconstruction of the road from Terri to Gurguri. This project will reduce travel time from Gurguri to the main highway and thus improve farm-to-market access. It will also facilitate transport of condensate from the well located in the area. Furthermore, for the last four years, MOL has been donating scholarships for intermediate education to able youngsters from needy families and, from 2007 MOL also started donating Technical scholarships to the students from TAL Block for higher education.
Having signed Manzalai Development & Production Lease with Government of Pakistan for minimum of 25 years, long term social welfare development planning and commitments including construction of schools, water supply schemes and scholarships are under preparation.
MOL aims to continue to invest in Health, Education and Water schemes in the years to come and the Government of Pakistan has been very appreciative of MOL’s success in finding hydrocarbon reserves as well as of its charitable efforts.
In mid October 2011 the MOL Pakistan found oil again in the Karak operational field.
– The European Commission has pronounced against the Croatian government’s changes to the law on ownership of INA, the Croatian oil and gas company. The changes would have reserved for the government alone the right to own 49 percent or more of INA’s shares. The government’s move clearly targeted Hungarian MOL, which holds nearly 49 percent of INA shares and seeks to acquire additional shares in open trading. Croatia’s financial market regulatory agency, HANFA, blocked that process by the simple expedient of suspending trading in INA shares on the Zagreb stock exchange six months ago. HANFA acted hand-in-hand with the government’s drafting of legislation targeting MOL (see EDM, April 12, October 3).
The European Commission has now determined that the government-proposed legislation contravenes the EU’s legal framework. The Commission’s finding is clearly a collective one, as the matter falls within the jurisdiction of several directorates in Brussels. Significantly, it is the office of the Commissioner for EU Enlargement that has announced the negative opinion and requested the Croatian government to take it into account. This suggests that the objectionable legislation risked delaying the completion of Croatia’s accession to the EU. The Commission however expressed appreciation for the government’s willingness to consult with the EU on the matter (HINA, Vjesnik, October 24-28).
Details of the Commission’s finding are not public, but the underlying considerations seem clear. The restrictive stipulations challenged the EU’s competition law, the free movement of capital within the EU, and other aspects of the acquis communautaire, as well as Croatia’s pre-accession commitment to the privatization of INA. Indeed, the restrictive draft law would have applied specifically to INA in order to hit at MOL, thus clearly showing discriminatory intent against an investor from within the EU.
On this as on other energy policy issues, the Croatian government seems to lack a consistent strategy, acting instead on contradictory impulses. Local special interests that used to milk the state-owned INA, have coalesced with Russian interests in harassing MOL, apparently hoping to squeeze it out of Croatia. Both of these sets of interests are represented in government. With parliamentary elections due in December, populist rhetoric distorts the public debate on energy policy.
On the other hand, the government does not want to jeopardize the time-table of Croatia’s accession to the EU by breaching EU law. The accession treaty is due for signing in December, and for ratification by the parliaments of 27 EU member countries (including Hungary) during 2012. This helped induce Prime Minister Jadranka Kosor to submit the government’s draft bill to Brussels for review, instead of passing it through the Croatian parliament unilaterally. According to local commentators, the EU’s negative judgment was not only predictable, but also a welcome excuse for the government to drop that restrictive, discriminatory legislation. This is no longer feasible in any case, as the parliament has just entered the pre-election recess (Jutarnji List, Poslovni Dnevnik, October 24-28).
The European Commission’s finding removes the basis for suspension of trading in INA shares in Zagreb. HANFA, the financial market regulator that had imposed the suspension, has now devised a new avenue of attack. It has filed criminal charges against top MOL executives in Hungary and on INA’s board for alleged insider trading, and referred the charges to the Prosecutor’s Office for further action. In parallel, Croatia’s Office against Corruption and Organized Crime and the Prosecutor’s Office are pursuing a bribery case against Croatia’s former prime minister, Ivo Sanader, and MOL’s president and CEO, Zsolt Hernadi. That case rests mainly on allegations by an individual Croatian businessman in a plea-bargaining case. Croatian law-enforcement authorities have not presented evidence to INA, MOL, or the counterpart Hungarian authorities. However, a campaign has been orchestrated in the Croatian press around those allegations (www.business.hr, Vjesnik, MTI, October 26-28).
Those allegations are designed explicitly to challenge the 2009 shareholders’ agreement, which strengthened MOL’s operating rights in INA with 47 percent of ownership shares. Local interest groups seem intent on wresting the operating rights back from MOL and using law-enforcement agencies non-transparently toward that end.
Since acquiring those operating rights, MOL has introduced European best-practices in INA’s management (practices that had turned MOL itself into a Central European leader); cleaned up socialist-legacy corrupt practices from INA; turned it from a chronically loss-making company into a profitable one; completed the first phase of INA’s refinery upgrade program; continued investing into it during the recession; and spearheaded efforts to interconnect Croatia with Central Europe and the EU’s evolving, unified energy market.
That progress can be rolled back by undoing its legal basis. Ongoing attempts to do so raise questions about the transparency of Croatian law-enforcement processes and their independence from special business interests. Croatia’s EU accession mechanism ought to consider these issues, ahead of the accession itself.
Unfortunately the MOL has been attacked in Croatia by those competitors who are interested in displacement of the Hungarian company, now trying to discredit the MOL in front of the public.
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