Regulator issues show cause notices to Jura Energy, Frontier Holdings and Spud Energy after court clears proceedings under petroleum rules.
The Directorate General of Petroleum Concessions (DGPC) has initiated regulatory proceedings against three exploration firms for alleged violations of petroleum rules, the National Assembly was told on Thursday.
Parliamentary Secretary for Energy Mian Khan Bugti said the DGPC issued show cause notices on July 18, 2025 to Jura Energy Corporation, Frontier Holdings Limited and Spud Energy Pty Limited under the Pakistan Petroleum (Exploration and Production) Rules, 1986 and 2001.
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He said the action was taken 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 provisions require completion of the show cause process before any suspension or revocation of exploration licences.
Bugti told lawmakers that the companies have been directed to submit detailed explanations and documentary evidence in response to the alleged breaches. Authorities will assess whether the firms can rectify violations or offer reasonable compensation under the applicable rules.
He said licence revocation remains a possible outcome but only after due legal process. The matter had remained pending before the Islamabad High Court for six months. The court disposed of the case on February 6, 2026 and directed the regulator to proceed strictly in accordance with the law after granting a fair hearing to all parties.
The Directorate General of Petroleum Concessions functions under the Petroleum Division of the Ministry of Energy and oversees licensing, monitoring and compliance of upstream oil and gas operations. Pakistan regulates upstream activities through the 1986 and 2001 exploration rules, which define bidding procedures, work commitments and penalties for non-compliance.
According to official data from the Pakistan Petroleum Information Service, the country has 19 sedimentary basins covering around 827,000 square kilometres. Of this, nearly 66% area remains under-explored, highlighting the sector’s long-term potential despite regulatory challenges.
Pakistan currently produces around 70,000 barrels per day of crude oil and over 3.2 billion cubic feet per day of natural gas, according to recent government statistics. Domestic output meets only a fraction of demand, forcing the country to import significant volumes of crude oil, refined petroleum products and liquefied natural gas.
The Pakistan Bureau of Statistics reported that petroleum group imports stood above $17 billion in the last fiscal year, making energy one of the largest contributors to the import bill. Volatile global oil prices and currency depreciation have widened the current account deficit in recent years.
Industry analysts say strict regulatory enforcement could improve compliance and investor confidence if applied transparently. However, frequent legal disputes and policy uncertainty have also slowed exploration activity.
Over the past decade, several international exploration companies have either reduced exposure or exited Pakistan, citing security concerns, pricing disputes and circular debt in the gas sector. At the same time, the government has introduced revised petroleum policies to attract fresh investment and boost domestic production.
The 2012 and 2024 petroleum policies offered improved pricing formulas and enhanced security arrangements to encourage drilling in frontier regions. Officials have repeatedly stated that increasing indigenous output is critical to reducing reliance on costly imports.
The latest DGPC action signals tighter oversight at a time when Pakistan seeks to enhance governance in the energy sector under broader economic reform commitments. The country is working under an International Monetary Fund programme that emphasises structural reforms, including energy sector transparency and loss reduction.
