PSO's financial position: receivables Rs 168 billion; payables Rs 141 billion

The total receivables and payables of Pakistan State Oil (PSO) have touched Rs 309.32 billion mark, of which Rs 168 billion are receivables and over Rs 141 billion payables.
According to official data available with Business Recorder, PSO receivables include Rs 34.038 billion from Water and Power Development Authority (Wapda), Rs 71.874 billion from Hub Power Company (Hubco), Rs 37.142 billion from Kot Addu Power Company (Kapco), Rs 2.65 billion from Pakistan International Airlines (PIA), Rs 250 million from Oil and Gas Development Company Limited (OGDCL), Rs 5.142 billion from Karachi Electric Supply Company (KESC) and Rs 1.11 billion from Pakistan Railways.
The national fuel supply company is to receive Rs 1.4 billion on account of audited price differential claim of High Speed Diesel (HSD), Rs 3.4 billion on account of price differential on Low Sulphur Fuel Oil & High Sulphur Fuel Oil (LSFO/HSFO), Rs 1.36 billion on account of price differential on imported PMG and Rs 8.6 billion price differential under GLMP.
The power sector is the major defaulter of PSO, which owes an aggregate amount of Rs 147 billion of which Hubco owes PSO Rs 71.9 billion, whereas Kapco and Wapda owe Rs 37.14 billion and Rs 34.04 billion, respectively while KESC Rs 5.142 billion. PSO's total payables to local refineries reached Rs 72.7 billion on November 11, of which Rs 33.5 billion owed to Pak-Arab Refinery Limited (Parco), Rs 10 billion Pakistan Refinery Limited (PRL), Rs 9.48 billion National Refinery Limited (NRL), Rs 16.78 billion Attock Oil Refinery Limited (ARL), Rs 2.3 billion to Bosicor and Rs 682 millions to others. If LC payment of Rs 68.633 billion is included total liabilities of the company are in excess of Rs 141 billion.
An official of the company talking about the current financial situation said total receivables have crossed Rs 168 billion mark, which is a matter of grave concern. According to the official, the huge outstanding is adversely affecting PSO's liquidity and it may lead to inevitable breakdown in the supply chain, resulting in fuel shortages in the country, which would lead PSO to default.
PSO monthly fuel supplies to power sector stand at Rs 32 billion of which power sector paid only Rs 10 billion. The continuous non-payment has made PSO cash strapped. As a result, the company has defaulted on local refineries payments this month which has adversely affected local production. Furthermore, the company is constantly struggling to meet its international payment obligations, as any default on the part of PSO to its international suppliers would disrupt supplies and the resumption is expected to take months.