LNG has landed Pakistan State Oil (PSO) and Sui Northern Gas Pipelines Limited (SNGPL) in a debt trap due to non-receipt of bills from customers.
The power sector was the biggest defaulter regarding payments to PSO for the supply of furnace oil in the past. However, it is SNGPL this year that has to pay the most money, about Rs 396 billion, to PSO. In March last year, these liabilities were Rs 277.8 billion. For reference, “PSO” buys LNG cargo from abroad which it supplies to Sui Northern Gas Pipelines Limited.
PSO is also facing a financial crisis due to non-payment of dues from various sectors on fuel supply. These receivables stood at Rs 508.3 billion in March last year as several clients failed to pay their bills.
Out of the total receivables that PSO has to receive, Rs 176 billion from the power sector for the supply of oil for power generation. Power generation companies have to pay Rs 146 billion, whereas Habco Rs 24 billion and Capco is obligated to pay Rs 5 billion to PSO.
PSO also provides jet fuel to national airlines to run their operations. PIA has to pay Rs 23.7 billion to PSO. Moreover, the state-owned Oil Marketing Company has to recover Rs 8.9 billion from the government for price differential claims.
On the other hand, “PSO” itself also has to pay 41.38 billion rupees for supplying fuel to oil refineries. It owes 24.4 billion rupees to Pak Arab Refinery Company, 6.1 billion rupees to Pakistan Refinery Limited, 3.49 billion rupees to National Refinery Limited, 6.13 billion rupees to Attock Refinery Limited and 1.12 billion rupees to Enar.