ISLAMABAD: Fingers are being pointed at three federal ministries—Ministry of Petroleum and Natural Resources, Ministry of Water and Power and Ministry of Finance. Fingers are also being point at two regulatory agencies—Oil and Gas Regulatory Authority (Ogra) and National Electric Power Regulatory Authority (Nepra). Fingers are also being pointed at Pakistan State Oil (PSO). Who is really responsible? Ministry of Petroleum’s officially stated mission is: “To ensure availability and security of sustainable supply of oil and gas for economic development and strategic requirements of Pakistan....”Next; the Ministry of Water and Power. As per PSO’s financial statements for the period ending September 30, 2014, Water and Power Development Authority (Wapda) owed PSO a massive amount of Rs173 billion. For the record, the Ministry of Water and Power has a Power Wing and the Power Wing is responsible for the overall supervision of performances of power organisation such as CEA, Wapda, Nepra, PPIB, PCIW, NPCC, and Nespak. Next; the Ministry of Finance. As per PSO’s financial statements for the period ending September 30, 2014, the Ministry of Finance did not owe anything to PSO. The conclusion being that the Ministry of Petroleum and Natural Resources is directly responsible for the fuel crisis while the Ministry of Water and Power is indirectly responsible. The Ministry of Finance, however, cannot be held responsible. Ogra was set up under the Oil and Gas Regulatory Authority Ordinance of 2002 to “protect the public interest... provide effective and efficient regulations... to create a working environment where the interests of all stakeholders namely the consumer, investor and the government is protected through independent and fair regulatory practices.” Ogra has been completely captured by the companies that Ogra was supposed to regulate. In the interest of the consumers, Ogra failed to enforce regulations on the maintenance of two-week supply of petrol. Ogra should be held responsible. Nepra has been completely captured by the very industry it was charged with regulating. Nepra the gamekeeper has turned poacher. Nepra the public interest agency is controlled by the IPPs. As of today, Nepra serves its “regulated subjects rather than those whom the authority was designed to protect”. Nepra promotes the interests of power producers at the cost of 186 million Pakistanis. Nepra is partially, if not wholly, responsible for the multi-billion rupee circular debt. Nepra is indirectly responsible for the current fuel crisis. PSO’s officially stated mission is: “We are committed to leadership in energy market through competitive advantage in providing the highest quality petroleum products and services to our customers.” PSO has totally failed in its stated mission. PSO is at the very heart of the entire controversy. PSO is the monopoly importer and the price fixer. PSO has managed to default on Rs110 billion worth of Letters of Credit (LCs) to foreign suppliers. PSO has managed to exhaust its domestic overdraft limit of Rs284 billion. Banks including MCB, NBP, HBL and UBL are not willing to extend further credit. In just one month, PSO paid bank penalties in the amount of Rs250 million. Over the past few months, PSO has paid $8 million in demurrages and damages to suppliers. PSO’s total liabilities have gone up from Rs132 billion in 2009 to Rs293 billion in 2014. That is ineptitude and incompetence-two in one. PSO is directly responsible.
