Cabinet approves Rs82bn to repay OGDCL loan

ISLAMABAD: The federal cabinet has approved the payment of Rs82 billion to the Oil and Gas Development Company Limited (OGDCL) to repay a 12-year-old loan.

The Ministry of Electricity’s Power Holding Limited had borrowed the amount from OGDCL in 2012. Interest on loan will also be paid. According to government sources, the purpose of the loan funds was to pay the dues of power companies and settle the inter-corporate circular debt of the power sector.

Sources say the Ministry of Finance had given a guarantee of the financing facility on behalf of the President of Pakistan. The federal government later converted the financing facility of OGDCL into a government loan and allocated Rs82 billion in the budget of the current financial year.