ISLAMABAD: The receivables of Pakistan State Oil (PSO) have reached Rs 734 billion including Rs 163 billion late payment surcharge (LPS) as several clients failed to retire their bills for fuel supplies.
PSO mainly supplies oil to different clients across the country and also provides liquefied natural gas (LNG) for a public gas utility. Besides oil, circular debt has also emerged in the supply of imported LNG, which has contributed Rs 467.7 billion to the debt.
Generation companies are the major defaulters that have to pay Rs 147.6 billion. Hubco owes Rs 25.3 billion, whereas, Kapco has to pay Rs 5 billion.
PSO brings LNG cargoes for onward supply to Sui Northern Gas Pipelines Limited (SNGPL), which then distributes the gas among end-consumers. The SNGPL has to pay exchange losses of Rs 6.7 billion to PSO on account of LNG supply.
Parliament has passed a bill for introducing weighted average cost of gas, which is the average price of imported LNG and locally produced natural gas, to curtail circular debt in the gas sector.
Earlier, there was no legal framework for recovering LNG prices from domestic consumers, leading to the pile-up of receivables.
Pakistan International Airlines (PIA) is another major defaulter. PSO supplies jet fuel to the airline for running its operations. PIA has to pay Rs 24.5 billion to PSO.
The state-run oil marketing company is also due to receive Rs 8.93 billion from the government on account of price differential claims (1996-2014). The exchange rate differential on FE 25 loan is stood at Rs 48.1 billion.
Copyright Business Recorder, 2023