Pakistan State Oil on the verge of default

Pakistan State Oil on the verge of default
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ISLAMABAD: Pakistan State Oil is in hot waters over the issue of the Default payments.

The financial condition of Pakistan State Oil (PSO) – the market leader in oil sales – is worsening day by day and its receivables from different enterprises, particularly power companies , have swelled to Rs277 billion.

A senior official of the Ministry of Petroleum and Natural Resources said PSO was facing the spectre of default on payments to domestic and international fuel suppliers.

Payables of power producers to state-owned PSO swelled Rs18.5 billion in the past one month that took their total unpaid bills for fuel supply to Rs246.7 billion. “Most of PSO’s outstanding bills were the outcome of delay in payments by the public sector,” the official said.

By February 8, 2017, power companies had to pay Rs186.5 billion as well as a late payment surcharge of Rs60.2 billion. Total payables stood at Rs246.7 billion.

State-owned power generation companies owed PSO Rs142.5 billion, Hubco Rs71 billion, Kot Addu Power Company (Kapco) Rs24 billion, Pakistan International Airlines Rs15 billion and Wapda Power Privatisation Organisation (WPPO) Rs7.2 billion. The government also had to release Rs9.6 billion in price differential claims.

Sui Northern Gas Pipelines Limited (SNGPL) was required to pay Rs6.6 billion for the supply of liquefied natural gas.

The figures showed that both public and private power companies had to settle PSO’s outstanding bills.

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