Non-payment of dues: PSO warns of disruption in flight operations

ISLAMABAD: The Pakistan State Oil has rung the alarm bell in a meeting of the sub-committee of the Public Accounts Committee with saying that non-payments of its dues could disrupt the flight operations.

PSO officials told the sub-committee that the Finance Ministry should have to release Rs 20 billion to avoid the collapse of the PSO. The meeting was held on Tuesday, chaired by its Convener Sardar Ayaz Sadiq in which the audit paras of the Petroleum Division for the years from 1999 to 2009 were examined. The managing director of the PSO told the sub-committee that the total dues of the PSO are over Rs 360 billion while the PSO needs Rs 103 billion and Rs 105 billion for April for the Letter of Credit for which there was neither an alternative plan nor any financial plan. He told the committee that the PSO provided 96 per cent of the jet fuel to aviation companies and funds were not released to the PSO. It is for this reason that the system of flights could be collapsed.

The petroleum secretary seconded the views of the PSO’s DMD but said the bailout package for the PSO will be approved by the federal cabinet and the ECC of the cabinet. The PSO deputy managing director requested the Finance Ministry to release Rs 20 billion funds to save the company.

The representative of the Finance Ministry told the committee that the tender for the Islamic Sukuk bonds of Rs 200 billion for the payment of Rs 360 billion circular debt of the PSO was to be open in Karachi but was stopped at last minute due to objection of the Mutual Funds Association and this matter will be settled in a day or two.