In a blunt statement, Petroleum Minister Musadik Malik informed the Standing Committee on Energy that foreign firms are disinterested in oil and gas exploration mainly due to security reasons and the extensive costs of creating facilities for on-site workers and engineers. This confirms once again that investments and booming business are not possible unless the security situation improves. Even in potential sectors, Pakistan is losing out on opportunities. Existing companies in the oil and gas exploration sector have already withdrawn, but security is not the only reason.

Pakistan generally lacks a conducive environment for doing business, and taxation is a significant factor. Massive field maintenance costs are another liability for firms undertaking exploration ventures. The disinterest of foreign firms leaves two options: either Pakistan takes up exploration on its own or creates ease of doing business on an emergency basis. The former will require years of capacity building. Oil well and gas field exploration requires big machinery and expertise, which will be too costly for Pakistan given its present economic burdens.

Therefore, the best option is to facilitate foreign firms, offer incentives, and create attractive contract terms. This will require all technical experts in the petroleum sector to collaborate and lay down a proposed plan to discuss its feasibility with other arms of the government. The oil and gas sector is one of the few potential revenue-generating sectors, and seeing it wasted due to poor policies is a pity. The government must devise a strategy to invite foreign firms and ensure they stay.