Islamabad: Pakistan’s Directorate General of Petroleum Concessions (DGPC) has begun regulatory proceedings against three exploration companies accused of breaching petroleum regulations, a move that could lead to suspension or revocation of their licences after completion of legal formalities.
Parliamentary Secretary for Energy Mian Khan Bugti informed the National Assembly that show-cause notices were issued on July 18, 2025 to Jura Energy Corporation, Frontier Holdings Limited and Spud Energy Pty Limited under the Pakistan Petroleum (Exploration and Production) Rules of 1986 and 2001.
According to the government, the notices were served under Rule 68(d) and Rule 71(c) of the 1986 Rules, read with Rule 69(d) and Rule 52(f) of the 2001 framework. These clauses require regulators to complete the show-cause process and provide an opportunity of hearing before any adverse action is taken against licence holders.
The companies have been asked to submit detailed written responses and supporting documentation. Authorities will determine whether the alleged violations can be remedied or whether compensation mechanisms under the rules apply. Licence revocation remains an option but only after due legal procedure is exhausted.
The issue had been pending before the Islamabad High Court for six months. On February 6, 2026, the court disposed of the case and directed the regulator to proceed strictly in accordance with the law while ensuring fair hearing rights for all parties involved.
Oversight of upstream operations
The DGPC functions under the Petroleum Division of the Ministry of Energy and is responsible for awarding, monitoring and regulating upstream oil and gas licences in Pakistan.
The 1986 and 2001 exploration and production rules govern bidding processes, work programme commitments and penalties for non-compliance. These regulations form the legal basis for exploration activities across the country’s sedimentary basins.
Official data indicates Pakistan has 19 sedimentary basins covering roughly 827,000 square kilometres, with nearly two-thirds of the area considered under-explored. Despite this potential, domestic output remains limited.
Government statistics show Pakistan produces around 70,000 barrels per day of crude oil and over 3.2 billion cubic feet per day of natural gas. This output meets only part of national demand, leading to substantial reliance on imported petroleum products and liquefied natural gas.
The Pakistan Bureau of Statistics has reported petroleum imports exceeding $17 billion in the previous fiscal year, making energy one of the largest components of the country’s import bill.
Reform and investment landscape
Over the past decade, some foreign exploration companies have reduced operations or exited the market, citing security concerns, pricing disputes and circular debt in the gas sector. In response, the government introduced revised petroleum policies in 2012 and again in 2024 aimed at improving pricing terms and encouraging drilling in frontier and offshore areas.
Officials have repeatedly stated that increasing indigenous energy production is essential to reducing import dependence and strengthening macroeconomic stability.
The latest regulatory action comes as Pakistan continues structural reforms under an International Monetary Fund programme, which includes measures to enhance transparency and governance in the energy sector.
