ISLAMABAD – Pakistan State Oil (PSO) is barely managing to ensure the smooth supply of fuel in the face of staggering receivables against different entities of over Rs 158 billion. “We are going through a tough time at the moment, finding it hard to ensure uninterrupted flow of fuel supply when entities in power sector and especially Pakistan Railways have adopted piece-meal approach in repaying our dues accumulated to Rs 900 million,” the company’s official told APP. The source hoped the PSO is set to receive a cheque valued at Rs 250 million from the Pakistan Railways whose cheques were often dishonored for no-availability of funds in its accounts.
The official hastened to add that the government intervention was needed to inject adequate funds into Pakistan Railways, to sustain its operations and enable it continue payment in future on regular basis. Recently, the PSO had to cut off fuel supply to power sector entities including WAPDA, Kapco and Hubco that failed to pay their dues of Rs 47 billion, Rs 28.86 billion and Rs 73.29 billion, respectively.
Elaborating, the official said that PSO’s receivables had swollen to Rs 158.495 billion as of March 24, including Rs 42.293 billion from WAPDA, Rs 71.650 billion from HUBCO, Rs 29.380 billion from KAPCO, Rs 1.689 billion from PIA, and Rs 2.097 from KESC. “If we do not get these dues we will not be able to pay Rs 95.318 billion to the refineries and Rs 52.849 billion to the international suppliers,” the official warned. It is also notable that the PSO as the country’s largest energy company was aware of its responsibilities and had supplied furnace oil uninterruptedly to the power companies in the past.
But the growing circular debt and mounting receivables forced the company to suspend supplies, the source indicated. However, the official added, despite massive financial problems, the PSO had put its plans in place including to own a refinery to make coverage more efficient and widespread for meeting the country’s growing energy needs. In view of its excellent performance, the company, the official said, had received wide appreciation and worldwide recognition for its excellent performance. In the first half of the financial year 2010-11, the company notched up record earnings when after tax its earnings stood at Rs 7.13 billion in comparison to Rs 5.08 billion in the same period of FY 2009-10, despite the circular debt which is badly affecting supply chain of the oil sector including the PSO.
The company was honoured at the 27th Corporate Excellence Awards ceremony organised by the Management Association Pakistan (MAP). Similarly, the company was ranked 20th in the 7th Annual Dinar Standard survey published in the top 100 Businesses of the Muslim World, recently. “We consider these achievements as recognition of PSO management’s vision towards excellence combined with the dedication and hard work of all the employees,” the official stressed.
