Oracle announces 1.4 billion tonnes of lignite coal at Block VI, Pakistan

[asaad-ul-islam]

the problem with privatisation is that our own nation will not benefit, unless there some strings attached. we can't just give our natural resources away for free, rather these companies should offer a joint venture with our own, or otherwise buzz off.

this way we can improve upon our own techniques for mining, drilling, etc. then we should focus on nationalizing these assets, once we have the industrial base to absorb and further develop through R&D. the main point is self-sufficiency, indeginization, whatever you want to call it.

otherwise you can just keep these assets under the control of the govt. and offer contracts to private parties to run them. right now, all i see is pakistan giving away its wealth to greedy hoarders. don't be fooled by this privatisation, globalisation, and free market scam.

look at Russia, as soon as Putin took over, he nationalizes all the oil and gas companies. that's why you see so much bullsh.. on BBC world about Russia and democracy. now russia is reaping the fruits, expanding its military.

take a look at Saudi Arabia, they jointly ran Aramco with American companies. then the king at that time threatened to nationalize the company unless they shared 50-50 of the profits. soon Saudi purchased 25% share, then 60%, and finally fully purchased it in 1980.

now they are reaping the benefits, especially with the high oil prices right now. now Saudi will spend $500 billion dollars to build seven "blade runner + middle eastern" style cities to push for an industrial economy and even still their oil is not running out anytime soon.

 

[niaz]

Aquestion for Niaz Sahib.
There have been news items to the effect that the chinese company who were assigned the task of excavating(?) the copper and Gold mines at Saindak are getting too much ore out and by the time they hand over to the Government, there would not be much left. The question is when contracts are negotiated are there any guarantees that the company responsible would excavate X amount of ore out and not more. How do these contracts work? Thanks in advance for your explanation
WaSalam
Araz

I can only comment on the petroleum concessions; as it is the only industry that I have been deeply involved in. At first an accurate estimate of the reservoir is made. This is thru drilling at least three or four bores and analysing the 'Pay Zone' at various depths.

Reservoir engineers then determine the optimum production level. (Managing the reservoir is a science in itself.). An agreement is subsequently reached with the country to achieve a level of production over the life of the reservoir. Mostly it has got to do with investment as additional facilities such as gas re-injection is needed to maintain the production level and forecast of the future prices. The oil in the ground being essentially money in the bank.

One can assume that somewhat similar procedure will apply to mining. Ore is something big and heavy; it can’t simply be put in pocket and fritted way. I would presume that there would be Geologists belonging to GOP who will know how much ore there is and how much is taken out. Naturally, an investor would like to take the money out as early as possible and a compromise figure for the amount of ore extracted each year would have been agreed in advance.

I would not put too much faith in the rumours; most of these are wrong and sensationalizing. It is a fashion to portray that all bureaucrats in govt are idiots and any man on the street has more sense than very senior govt officers. For example the news about a Swat man producing a 20 MW electric generating plant for Rs 70,000 that came out. Pray tell me, a country where there is 8 hours of load shedding every day and there is talk of buying mobile power plants for hundreds of millions of dollars; there is no one in ruling or opposition party or govt bureaucracy who will take up this cheap option??. To me this was printed with evil intentions and with very little research into its accuracy.

There is another post about privatization. Again I can comment about my own industry based upon self reference.

In the good old days of Esso, each year there was a performance appraisal. Employee given full chance to explain and justify his performance. In case of below par performance he was offered a voluntary retrenchment. Result was a highly efficient and motivated workforce with very capable management. Salary was of course among the highest in Pakistan. Since nationalization it went to the dogs. The son of the petrol station dealer at Larkana (Where ZA Bhutto used to buy petrol from) was appointed a senior salesman. He reported to me and I was told that I shouldn’t give him too much work. Since he used to sit and talk on the phone all the time, he felt embarrassed and asked to be given a room so that I cant see him doing nothing all day. Brother in Law of Jatoi was made general manager; he was a purchase officer in one of gas companies before. All the senior officers were appointed thru political connections and merit went out of the window. All this was too much for me to swallow, so I contacted a friend in Kuwait National Petroleum Company and moved there.

Thankfully during Zia's time when some of the retired military officers took over, though not very bright, at least they took notice of the merit and the company regained some of its efficiency. I may be wrong, but I firmly believe that except the public utilities, such as transport, where there is a need for cheap non profit service; government should not get involved. All manufacturing concerns should be run on commercial basis.
Even in the UK, National Coal Board has proven to be inefficient and many coal mines have been privatized.

 

[Quwa]

Asaad,

Finding and extracting coal is a very expensive proposition. These private companies have to foot the bill to build the necessary infrastructure to just search for gas and coal. Now we're talking Pakistan - the worst of countries (courtesy of the media) - and these Western firms see it as a huge risk to be drilling. Given that the Pakistani govt won't do much, and even if it had the intention, it would need to beg for high interest private loans. Since the banks are all against Pakistan too, I don't they would give us a loan without cutting some extra profit from the coal/gas.

The other option...is encouraging private firms to extract Pakistani gas, coal and minerals. As sick as that sounds, we can encourage them by putting a law that those companies must sell all raw resources to Pakistani State Enterprises. Think of it as a defacto sale of all Pakistani resources at international rates to Pakistan. These State Enterprises would then refine and/or process the gas-coal-stones and do whatever they want. I think it would be easier to buy refinery technology for gas from Qatar; synthetic fuel plants from Germany or Australia; gold refinery systems from China or South Africa, etc.

This ensures that companies could foot the bill and time to search for Pakistani gas/coal and extract it using the local labour force. Then it also forces the State to partially support the private sector as well turn public enterprises into profit driven corporations. The State could make a profit selling CNG, LNG, coal based synthetic fuel and build up its reserves with gold/silver/valuable minerals.

I think the bulk of the agriculture industry ought to be nationalized by buying private land at lucrative rates. The feudal lords with lots of $$ and no land could either become corporate industrialists by investing in consumer goods manufacturing in Pakistan...or leave the country. While the govt putting food on the market could tap into a significant portion of the average human being's paycheck.