Court directs Petroleum Division and DGPC to conclude proceedings over alleged unauthorized change of control that may trigger revocation of petroleum rights.
The Islamabad High Court has directed the Petroleum Division and the Directorate General of Petroleum Concessions to immediately proceed under law against Frontier Holdings Limited and Spud Energy Pty Ltd over an alleged unauthorized change of effective control.
The violation may lead to revocation of petroleum rights under Pakistan’s Petroleum Rules. The court order, issued in Writ Petition No. 4195 of 2025, instructed authorities to take the pending show-cause proceedings to their legal conclusion expeditiously and strictly in accordance with law.
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Parliamentary Secretary for Energy Mian Khan Bugti informed the National Assembly on Thursday that the Directorate General of Petroleum Concessions had launched regulatory proceedings against three exploration and production companies over alleged violations of petroleum rules. Speaking during the Question Hour, he said the DGPC issued a show-cause notice on July 18, 2025 to M/s Jura Energy Corporation, M/s Frontier Holdings Limited, and M/s Spud Energy Pty Limited.
The matter relates to a transaction executed in early 2025. Through that arrangement, Jura Energy Corporation allegedly transferred effective control of its corporate group, comprising Frontier Holdings Limited and Spud Energy Pty Ltd, to IDL Investments Limited via an offshore structure. Prior approval from the Government of Pakistan was not obtained before the transaction.
Under Pakistan’s petroleum regulatory framework, any disposition of share capital or ownership arrangement resulting in a change of effective control requires prior government consent. This requirement applies whether the change occurs directly at the operating-company level or indirectly through parent companies. In this case, such consent was never sought, triggering regulatory and legal concerns.
Following complaints and regulatory correspondence, the DGPC issued a show-cause notice dated July 18, 2025 under Rules 68(d) and 69(d). These provisions empower the government to revoke petroleum rights in cases of non-compliance, including unauthorized changes in ownership or control.
Despite the issuance of the notice, enforcement reportedly stalled. The delay raised questions over regulatory hesitation in what is considered a strategically sensitive sector. The matter eventually moved into litigation, with petitioners seeking intervention from the Islamabad High Court to compel the state to act.
During court proceedings, the DGPC submitted a reply that proved central to the case. The regulator did not dispute the legal breach. Instead, it reaffirmed that petroleum right holders are under a strict statutory and contractual obligation to comply with the Petroleum Exploration and Production Policy 2012 and the relevant Petroleum Rules.
The DGPC stated in its submission that any transfer or change in ownership or control can only be undertaken with prior approval of the government, acting through the DGPC. It emphasized that this safeguard exists to protect Pakistan’s sovereign, fiscal, and regulatory interests.
The regulator further acknowledged that breach of this mandatory requirement may render the petroleum right liable to action under the Rules. This admission strengthened the argument that Rule 69 applies directly to the case involving Frontier Holdings Limited and Spud Energy Pty Ltd.
The Islamabad High Court’s order now makes it binding on the Petroleum Division and the DGPC to proceed with the show-cause notice and complete the process in accordance with law. The directive effectively closes the door on any further administrative inaction.
Industry insiders say the court ruling has placed the regulator under a clear legal obligation to enforce Rule 69(d), which provides revocation of petroleum rights as the prescribed consequence in cases of unauthorized change of effective control.
The case is being viewed as a major test of Pakistan’s regulatory credibility in the petroleum sector. Observers say compliance with concession agreements and sovereign oversight remains essential for safeguarding national energy security and maintaining confidence in the upstream regime.
