Board of Directors (BoD) of Pakistan State Oil (PSO ) and Pakistan LNG Limited (PLL) have requested the Ministry of Energy (Petroleum Division) to conduct a formal inquiry into excess payments made by the former leaderships of both companies.
The multimillion-dollar scam in Pakistan’s two state-owned enterprises (SOEs) was disclosed in the board meeting of PLL, held on October 23, 2020. Reports state that PSO and PLL paid $39.5 million (Rs. 6.28 billion) in excess to the LNG suppliers as port charges, putting the top officials of the Petroleum Division in “a state of shock”.
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While talking to the media, one of the board members said,
The Pakistan LNG Limited is found to have paid additional payments of $25 million (Rs. 3.97 billion) to LNG suppliers of Gunvor and ENI and this was disclosed in the board meeting of PLL on October 23, 2020.
The Board of Directors has requested the Petroleum Division to carry out a formal inquiry against the former PLL Managing Director Nadeem Nazir, who currently holds the same position at Pakistan LNG Terminal Limited (PLTL).
A forensic audit of all payments made during the timeframe has also been requested by the board, which has also sought permission to ask LNG suppliers for recovery of the additional amount paid by the PLL.
According to news reports, the issue was highlighted by the recently appointed Managing Director of Government Holding Power Company (GHPL) Masood Nabi. He was given the acting charge of PLL in September 2020 and upon becoming aware of the excessive payments, he informed the board.
The PLL directors have also revealed similar information regarding PSO, stating that PSO made additional payments of $14.5 million (Rs. 2.3 billion) to Gunvor and other LNG suppliers. However, this payment is being reported to have already been recovered from the LNG suppliers.
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Regardless, the Board of Directors of PSO has also chosen to go the same way as PLL and have recommended action against the company’s LNG department. PSO has also initiated an inquiry against the company’s General Manager LNG, two deputy GMs, and two commercial officers.
Secretary Petroleum Division Mian Asad Hayuaddin has confirmed the news regarding excess payments made by PSO and PLL while also confirming that PSO recovered its additional payments from LNG suppliers.
