ISLAMABAD: The Economic Coordination Committee (ECC) approved nearly Rs51 billion in supplementary grants for defence and security needs, mainly for strengthening border security in areas near Balochistan, and also allowed Pakistan Petroleum Ltd (PPL) to hand over part of an offshore oil and gas block to a Turkish state-owned company.
The meeting, chaired by Finance Minister Muhammad Aurangzeb, also approved the creation of a new company that will handle wheat stock financing. This new body will replace the Pakistan Agricultural Storage and Services Corporation (Passco), which the government has decided to shut down.
According to an official statement, the ECC approved a summary from the Defence Division seeking a technical supplementary grant of Rs50 billion for several approved defence projects. Sources said most of these funds will be used to improve border security and surveillance along the Pakistan-Iran border, with some allocation for the Pakistan-Afghanistan border.
The ECC also approved two more grants worth around Rs941 million on the request of the Ministry of Interior and Narcotics Control.
A grant of Rs100.3 million will go to the repair and maintenance of defence equipment used by federal civil armed forces. Another Rs841.56 million will support border control, internal security operations, and law and order duties.
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In another major decision, the ECC approved a request from Pakistan Petroleum Ltd to transfer 25% of its share in the Eastern Offshore Block-C to the Turkish Petroleum Overseas Company (TPOC).
PPL was awarded the block in 2019 with complete ownership, but the federal government later directed it to include TPOC and local companies, including OGDCL and Mari Energies, to help speed up offshore exploration.
Under the new arrangement, PPL will keep a 35% share, while TPOC will take 25% and will become the operator of the block. Mari Energies and OGDCL will each hold 20% shares. The agreement also includes extended licence periods and updated working interest assignments for offshore exploration.
Officials said the entry of TPOC will bring valuable international experience to Pakistan’s offshore energy sector and is expected to improve technical capacity and project delivery.
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The Petroleum Division said the block has a “drill-ready prospect” and the upcoming exploration well could attract significant foreign investment. TPOC has also received stakes in two additional offshore blocks along with Mari Energies, awarded last week.
Meanwhile, the ECC also approved the establishment of a new special-purpose vehicle (SPV) called the Wheat Stock Management Company (WSMC). This SPV will manage wheat stock financing and replace Passco as part of the government’s plan to wind down the corporation.
The committee approved an initial paid-up capital of Rs1 million for the new company and reduced the authorised capital according to the requirements for Passco’s structured closure. The Ministry of National Food Security had earlier suggested an authorised capital of Rs150 billion, but ECC cut the figure significantly.
The new company will raise long-term financing from commercial banks, backed by government guarantees, to settle Passco’s outstanding liabilities. Passco will then be formally dissolved.
