02122016Fri
Last update: Fri, 12 Feb 2016 12pm

PSO has to pay hefty demurrages: PNSC chief

Chairman, Pakistan National Shipping Corporation (PNSC), Arif Ilahi, has said that all shipping companies are entangled with huge losses while PNSC is on the way of earning profit. In his address to the 37th general meeting of PNSC shareholders, Arif said PNSC has been able to net a net profit of Rs 2.11 billion during the current fiscal year. PSO has to pay PNSC a sum of Rs 1.5 billion in demurrages, he added.

"We are trying to make sure that this amount doesn't slip into circular debts. We are in contact with the Prime Minister and the federal minister of petroleum and natural resources," he said. Arif said PNSC management will talk to Imran-ul-Haq, Managing Director PSO regarding the dues. He said that if Karachi's ports were enhanced in depth, the country's shippping capacity of bringing oil will increase up to 80 percent. "We will be able to save up to $40,000 daily in demurrages if our ships are not lined up at ports waiting to load off," said Arif.

He told the audience that PNSC has a shipping contract with PSO which has clause regarding the revision of the rates. Rates have not been revised for three years. It was agreed upon that PSO will have to pay $15000 a day on account of demurrages whenever PNSC's ships are bound to wait at the ports. Karachi's ports are deep as per requirement. "If we don't have to wait in the ports for off-loading, we will be able to off-load easily and embark again for the next shipment. PSO management had assured us a payment of Rs 430.3 million before Eid-ul-Fitr. This amount has not been released so far," he noted.

The PSO's MD has now assured to pay off the dues after the final audit. To a question, Arif said that his side had offered PSO to establish a joint venture for oil shipments.

PSO has to take rental ships which cause additional cost to the company and losses to national exchequer. As a result of this, the prices of petroleum products go up and the end-consumer have to bear the brunt. Executive Director (Admin) Brigadier Rashid Siddiqui (Retd), Director Finance Imtiaz Aagboatwala and other directors were also present on this occasion.

Copyright Business Recorder, 2015