A meeting of the Public Accounts Committee (PAC) was held under the chairmanship of Member of National Assembly (MNA) Noor Alam Khan in Islamabad today, where members expressed anger at the nonpayment of Rs. 44 billion outstanding debt owed by Cnergyico (formerly Byco Petroleum).
PAC Chairman directed authorities to seize and auction the properties of those involved in the case to recover the remaining dues owed by the company.
The committee members reviewed the matter of outstanding debt owed by HASCOL and Cnergyico (formerly Byco Petroleum). Chairman PAC said both companies had failed to pay what they owed to the Government of Pakistan and should be dealt with accordingly.
Secretary Petroleum informed the committee that Byco Petroleum, now Cynergyico, is a defaulter of Rs. 57 billion. He brought it to the committee’s attention that the company wasn’t fulfilling its financial obligations despite receiving money from Oil Marketing Companies.
A Federal Investigation Agency (FIA) official told the committee that Rs. 3.9 billion had been recovered so far from the company (Byco Petroleum). Noor Alam Khan retorted, saying the recovery paled in comparison to the total amount owed. He suggested the company’s records be presented before the public accounts committee. To expedite recovery efforts, he directed authorities to seize and auction off the property of those involved in order to recover the remaining dues.
Byco’s response
In its response to ProPakistani, the spokesperson of Cnergyico claimed that this is a simple matter of payables vs. receivables since different government entities owe Cnergyico to the tune of Rs. 79 billion.
“The matter is in court and is sub judice and as per the Honourable Court’s directives, the government has been restrained from any adverse action(s) against the company. The company has held numerous meetings and even shared payment plans in the recent past with the government and is currently in talks with them for any settlement,” the spokesperson added.
Revolving Debt of Petroleum Sector
PAC members also discussed the issue of revolving debt in the past year, with the metric observing an increase of over Rs. 500 billion during the period. The meeting was informed that the Ministries of Finance and Energy are working on paying off the debt of the petroleum sector.
Secretary Petroleum told the committee that the petroleum sector’s revolving debt had reached Rs. 1,700 billion this year so far, compared to Rs. 1,200 billion in the corresponding period last year.
The secretary said a plan had been prepared to eliminate the scourge of revolving debt by swiping assets of institutions operating in the sector. Additionally, a big chunk of debt will be cleared by transferring shares of GEPCO and Nandipur Power Plant to Pakistan State Oil (PSO), he said, adding that dues to the tune of Rs. 300-400 billion owed by power plants will also be cleared on a subsequent basis.
Gas
After discussions, PAC members directed to lift the ban on the provision of new gas connections for domestic consumers. In this regard, it was revealed that a letter will be written to the Prime Minister to expedite proceedings.
The committee grilled Secretary Petroleum for imposing fixed charges of ~Rs. 500 on domestic gas connections and recommended that these charges be removed to help the poor.
