Ordinance violated? Oil Prices to go up, OGRA notifies 9.6% hike in tankers’ freight rates

ISLAMABAD: Oil and Gas Regulatory Authority (OGRA), violating its owned ordinance, has notified 9.60 percent increase in freight rates for oil tankers – a major demand of Oil Tankers Contractors Association (OTCA) to call off their strike.

The decision has been taken by acting chairman Member Finance individually, sources said. The regulator has taken a decision to increase the rate when it has no quorum.

The new freight rates will be applicable from August 1, 2020.

The post of OGRA Member Oil is already vacant from April 2020 and after the departure of the chairperson Uzma Adil on July 17, 2020, the authority is left with only two members: Member Finance and Member Gas and has no quorum, newztoday.com revealed.

The OGRA Ordinance 2002 states: (1) The Chairman and two other Members shall constitute a quorum for a meeting of the Authority requiring a decision by the Authority. (2) The decision of the Authority shall be taken by the majority of its Members and in case of a tie, the Member presiding shall have a casting vote. (3) All decisions of the Authority shall be in writing and identify the decision of the Chairman and other Members separately. (4) No act, proceeding or decision of the Authority shall be invalid by reason only of the existence of a vacancy in, or defect in the constitution of the Authority. (5) The Chairman shall call all meetings of the Authority. The Chairman shall also call meetings of the Authority immediately on being requested in writing to do so by at least two Members of the Authority. (6) Each Member shall have reasonable notice of the time, place of the meeting and matter on which a decision shall be taken

In a letter to Oil Companies Advisory Council and Overseas Chamber of Commerce and Industry (OICCI) on July 21, 2020, the authority states that on the request of OTCA in the matter of revision of primary cartage freight rates, the authority has approved the increase of 9.60 percent in the prevailing freight for compliance.

The compliance includes:

The revised cartage slab rates have been determined or computed for 40 KL complaint tank lorry, applicable throughout the country excluding special freight areas of AJK, NA and Balochistan.

The revised primary freight rate has been determined at the rate of Rs 102.93 per 40 KL vehicle.

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