Fuel Cover Uncertain As PSO Scrambles for Money to Buy Fuel and Pay Off Refineries

Pakistan State Oil’s (PSO) receivables have ballooned to Rs. 718 billion with payables at Rs. 219 billion, according to the latest receivables and payables data of the state-owned entity.

Sui Northern Gas Pipelines Limited (SNGPL) is the biggest defaulter, owing PSO Rs. 455 billion for LNG imports. Overall, PSO’s liabilities have risen to Rs. 188 billion, which must be offloaded in order to import petroleum products from Kuwait Petroleum Company (KPC) and LNG from Qatar.

The power sector, which owes PSO Rs. 178 billion, has remained the second largest defaulter. Meanwhile, the Central Power Purchasing Agency (CPPA-G) and GENCOs have defaulted on Rs. 148.141 billion, followed by Hubco and KAPCO who have defaulted on Rs. 25.356 billion and Rs. 5 billion, respectively.

Pakistan International Airlines (PIA) owes Rs. 25.514 billion to the government-owned petroleum corporation. It is noteworthy that PSO is still owed Rs. 8.934 billion in price differential claims from the government between 1996 and 2014.

Further data reveals that dues owed to PSO by SNGPL, the power sector, and PIA have risen to Rs. 124 billion, demonstrating the inefficiency of the aforementioned companies.

In terms of payables, PSO is required to offload Rs. 188 billion in liabilities under the headings of opening letters of credit (LCs) for the import of petroleum products from KPC and a standby LC for LNG imports from Qatar.

PSO’s financial numbers also reveal that it is a refinery defaulter, having failed to pay Rs. 30.4 billion in dues to 5 different refineries. This sum includes Rs. 22.092 billion owed to Pak-Arab Refinery Company (PARCO), Rs. 155 million to Pakistan Refinery Limited (PRL), Rs. 2.17 billion to the National Refinery Limited (NRL), Rs. 4.980 billion to Attock Refinery Limited (ARL), and Rs. 1.027 billion to ENAR.