Clearing outstanding dues under circular debt: Ministries take notice of 'undue' pressure by refineries

Ministry of Finance and Ministry of Petroleum have taken serious notice of undue pressure being mounted by three refineries National Refinery Limited (NRL), Attock Refinery Limited (ARL) and Bosicor to clear their dues under circular debt, which are themselves big defaulters of Oil and Gas Development Company Limited (OGDCL), Pakistan Petroleum Limited (PPL) and also government on account of Petroleum Levy (PL) on Petroleum products.
According to break up available with Business Recorder as on February 4, 2011, Pak Arab Refinery Limited (Parco) is to pay Rs 2.98 billion to OGDCL and its receivable from PSO are Rs 27.81 billion. PRL payable to OGDCL and PPL stand at Rs 6.79 billion. These two refineries are to receive Rs 27.81 billion and Rs 10.70 billion, respectively from Pakistan State Oil (PSO).
But NRL, ARL and Bosicor are to pay Rs 51.12 billion to OGDCL and PPL, which is Rs 5.13 billion higher than their receivables against PSO. NRL is to pay Rs 11.21 billion, ARL Rs 33.13 billion and Bosicor Rs 6.78 billion to OGDCL and PPL. NRL, ARL and Bosicor receivables against PSO stand at Rs 9.20 billion, Rs 32.25 billion and Rs 4.54 billion, respectively.
"In addition, these refineries are withholding billion of rupees PL on petroleum products due to circular debt," sources said adding that in this way NRL, ARL and Bosicar are to pay more money to OGDCL, PPL and government compared to what they are to receive from PSO. "Therefore, Finance Ministry and Petroleum Ministry are upset of pressure being mounted by these refineries to clear dues under circular debt," sources maintained.
As on February 4, 2011, PSO receivables against different clients especially power sector have again surged to 148.85 billion, which follow as: the Wapda Rs 46.35, Hubco Rs 63.1 billion, Kapco Rs 24.6 billion, PIA Rs 1.007 billion, OGDC Rs 344 million, KESC Rs 1.7 billion, price differential claims (PDC) on High Speed Diesel (HSD) Rs 1.38 billion and Rs 5.35 billion PDC on imported PMG.