PSO warns of complete dry-out

Discussion in 'Pakistan' started by Blackwater, Apr 7, 2013.

  1. Blackwater

    Blackwater Veteran Member Veteran Member

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    ISLAMABAD: Pakistan State Oil, the country’s largest fuel supplier, on Thursday reported to the prime minister that it had defaulted on domestic and international payments and warned of a complete dry-out in a few weeks.

    “We expect a complete dryout in or around second week of May on current total supply pattern of 16,000 tons per day of both HSFO and LSFO,” said PSO managing director Naeem Yahya Mir to secretary of petroleum and natural resources who presented the letter to caretaker Prime Minister Mir Hazar Khan Khoso.

    “Presently we have already defaulted on local and LC’s (letter of credit) payments amounting to Rs11 billion,” the letter said.

    At a meeting, presided over by the caretaker prime minister, the ministry of petroleum explained that further fuel supplies to power sector could not be provided on credit because of non-reliability of Wapda companies.

    Fuel could be supplied to the power sector only on a firm guarantee of the finance ministry that timely payments would be made, the prime minister was informed.

    The petroleum ministry informed the prime minister that PSO’s receivables from power sector had increased to Rs141bn while receivables of gas companies now stand at Rs175bn. This has created severe liquidity problems for the oil and gas sector.

    A PSO spokesperson, Maryam Shah, confirmed that PSO had committed technical defaults for more than five times in recent days and the fuel supplier had to pay penalties for the defaults.

    The PSO had also informed the government that because of repeated technical defaults, no bank was ready to open letters of credit to order future oil imports, therefore, it would be impossible to provide fuel on credit.

    The caretaker prime minister constituted a four-member committee, led by his principal secretary, and comprising secretaries of petroleum, water and power and finance, to hold consultations on day-to-day basis and submit a report within three days so that decisions could be made to avoid disruption in supply chain and increase in load-shedding as temperatures go up.

    The PSO chief said if financial issues were not addressed on an urgent basis, it could “result in total collapse of supply chain, both from financial and product availability perspective.

    He lamented that despite its request on March 28, the company was surprised that no endorsement of tenders had been conveyed to the company to order fresh imports.

    “Any further delay will definitely result in a dry-out situation in the country when present stocks will exhaust and cargoes will not arrive timely.”

    With current stocks enough to meet ongoing reduced supplies until first of May, it would be difficult to arrange additional supplies for higher power generation demand in peak summer months of May to September.

    The PSO attributed the shortage situation to non-disbursement of Rs47bn committed in early March. Because of cash constraints, the PSO said “it could not order further oil cargoes.” Default is already in place and “consequential defaults might result in banks calling the borrowing lines and refusal to open further LCs for cargoes already awarded.”

    The PSO chief said that “please note that PSO will not be responsible for direct and indirect consequences of product un-availability and supply chain break out.”

    Giving a break-up of receivables, the PSO said an amount of Rs48 bn was outstanding against Wapda, Rs56bn against Hubco, Rs11 bn against Kapco and Rs11.5bn against KESC among top defaulters.

    The company said its outstanding payments to Kuwait Petroleum and other fuel suppliers stood at Rs73bn on April 4, followed by Rs21bn to Parco and Rs10bn to Attock Oil.


    PSO warns of complete dry-out | Pakistan | DAWN.COM
     
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  3. Blackwater

    Blackwater Veteran Member Veteran Member

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    IS testing of NASR responsible for this???:lol::lol::laugh::laugh::rofl::rofl::rofl:
     
  4. SLASH

    SLASH Senior Member Senior Member

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    Hope there game changing water-kit is up for the task.:rofl:
     
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  5. Singh

    Singh Phat Cat Administrator

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    Saudis might chime in ? And the Pak govt's coffers are empty, I think they will be given (or they need) 9-10bn$ bailout from IMF

    BTW Petrol and Diesel in Pakistan is much cheaper than India. And a large number of Pakistani vehicles run on the cheap CNG.
     
  6. Blackwater

    Blackwater Veteran Member Veteran Member

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    free da maal ha phaaji. saudi has already pledged free oil supply for 4 yrs in the name of islam
     
  7. Decklander

    Decklander New Member

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    I think it will be good for Pakistan to do a barter deal for J&K with India in which India supplies them fuel and Electricity for land of J&K. They are already selling their land to Chinese. In this case they will be selling India, indian land.
     
  8. arnabmit

    arnabmit Homo Communis Indus Senior Member

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    Pak can infact sell entire PoK back to India for a sum equal to their IMF & World Bank loans. That sum won't even put a dent on Indian economy.

    OT, but come to think of it, India can also buy out the Chittagong Hill track from BD to ensure port access to NE states. :hmm:

     
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  9. drkrn

    drkrn Senior Member Senior Member

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    for its support over Iran.of course not for too long
     
  10. drkrn

    drkrn Senior Member Senior Member

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    do you want India to admit that the land is Pakistani??
     
  11. farhan_9909

    farhan_9909 Tihar Jail Banned

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    if it is all about dreaming

    why dont you dream about pakistanis leaving the whole pakistan to india for akhand bharat and the pakistanis to settle in afghanistan
     
  12. Patriot

    Patriot Senior Member Senior Member

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    May be in return of adding variety in Saudi harems. One Paki Beauty for 100 barrel.
     
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  13. Godless-Kafir

    Godless-Kafir DFI Buddha Senior Member

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    Did your country gift land to China or not...Simple question?

    Later Did they consider selling land or not?
     
  14. Decklander

    Decklander New Member

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    That will be sonay main suhaaga.
     
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