The chairman of
Receivables of PSO swelled to
It seems PSO is heading towards a financial crisis which may bring to a halt oil supply to the airlines.
The issue was taken up in a recent meeting of the Economic Coordination Committee (ECC) when the Petroleum Division sought to offset the loss of
The ECC was informed that PSO had so far suffered a net exchange loss of
PSO was facing a liquidity crunch as its receivables from power producers,
PSO profit drops 17% to
The huge overdue amount was undermining PSO's ability to make uninterrupted energy supply to different sectors across the country. There was a risk of default by PSO on local and international payments and in that case jet fuel supply to domestic and foreign airlines may be hampered.
The state of affairs had already been conveyed by the PSO board chairman to the finance secretary and delay in reimbursement of the exchange loss on loans may aggravate the situation.
The Petroleum Division told the ECC that the Finance Division had advised oil-importing companies to explore the possibility of making long-term financing arrangements with banks and other financial institutions.
In such financing facilities, extra costs and risks were to be borne by the oil-importing companies whereas the federal government committed to defray such costs and risks.
Following the directives and advice of the Petroleum Division given from time to time, PSO had been utilising FE-25 loans - a deferred payment facility - from domestic and international banks operating in
In that respect, PSO had to date borne a net exchange loss of
The Petroleum Division proposed that provision of
The ECC gave directives for considering allocation of the requisite amount for PSO in the next financial year. It also directed the finance secretary to explore the possibility of clearing some of the claims in the current fiscal year in consultation with the petroleum secretary.
Responding to
© Pakistan Press International, source