$25m scandal of excess payments: Govt removes MD PLTL; Masood Nabi appointed acting MD

ISLAMABAD: At last, the government has removed Nadeem Nazir from the post of MD Pakistan LNG Terminal Limited (PLTL) and appointed MD Govt Holdings Private Limited (GHPL) Masood Nabi as its acting MD with immediate effect from November 30, 2020 following news reports about the scam of excess payments of $25 million by the PLL (Pakistan LNG Limited) to LNG suppliers as port charges published in The News International’s editions of November 9 and 10, 2020.

The News had published on November 9, 2020 a story with the headline of ‘PSO, PLL paid Rs6.28 bn to LNG suppliers in excess'; and on November 10, 2020, the story with headline of ‘Scam of excess payments to LNG suppliers: Energy ministry mobilizes for action against MD PLTL.’

PSO had also made excess payment of $14.5 million to LNG suppliers, but it recovered the said amount. However, the inquiry against GM LNG of PSO is underway. But the excess payments made by the PLL have not so far been recovered from the LNG suppliers.

The Pakistan LNG Limited (PLL) deals with imports of LNG and Pakistan LNG Terminal Limited (PLTL) deals with affairs of Pakistan Gas Port Company (PGPC) LNG Terminal. Nadeem Nazir was also the Chief Financial Officer (CFO) of PLL from April 2018 to August-September 2020 and he also held the portfolio of MD of PLL for two months till September 2020. He was originally appointed the CFO of PLTL and continues in that position.

According to the letter written on November 30, 2020 to secretary PLTL Board under the subject “Excess payment to LNG suppliers in connection of port charges’, the Petroleum Division said that the competent authority had appointed Masood Nabi MD of Government Holdings Private Limited (GHPL) as acting PLTL MD with immediate effect from November 30, 2020 till the appointment of regular incumbent, unless revoked earlier. Until November 30, 2020, he was the PLTL MD too.

The spokesman of Petroleum Division, Qazi Sajid, also confirmed to The News saying that Nazir has been removed as PLTL MD on alleged charges of excess payments of $25-26 million to LNG suppliers. He said that a three-member fact finding committee has been notified to submit its findings within

2-3 weeks time and if Nadeem Nazir is found guilty, he will be also terminated from the post of CFO. "So far, all fingers are being pointed towards him." The three-member inquiry committee has already started work.

According to the official documents available with The News, GHPL MD Masood Nabi as PLL MD on behalf of the PLL board complained on November 1, 2020 to secretary Petroleum

Division disclosing that in the PLL Board meeting of October 23, 2020, the issue of excess payments of $25-26 million to LNG suppliers was disclosed by the new PLL management. Nadeem Nazir was responsible for all financial transactions, including those to the LNG suppliers. The letter claimed that the PLL management (the then MD and CFO) came to know about the excess payments for the first time in October 2018. However, a committee headed by the-then CFO of PLL (Nadeem Nazir) was constituted in June 2019 by the then MD PLL Adnan Gillani to determine if they were making excess payments. The said committee found the allegations true. While, the then CFO stopped excess payments to some LNG suppliers, he continued to pay excess payments to GUNVOR and ENI under the pretext of maintaining an ‘amicable relationship’.

This is where the excess payments issue turned into a scam. In August 2020, PLL received the much-awaited opinion from English law firm that the port charges being paid by PLL were in fact to be paid by LNG suppliers. The most alarming aspect of the ugly episode is that the PLL management comprising the then MD (Adnan Gillani) and CFO (Nadeem Nazir) kept the PLL board in the dark about these extra payments.

The Petroleum Division (PD), acting on the complaint of PLL board, asked it to initiate proceedings against Nadeem Nazir. The PLTL Board took 10 days to recommend Nazir’s removal. As a result, the Petroleum Division issued the notification on November 30, 2020 for appointing a new acting MD.

When contacted, PLTL Board Chairman Asim Murtaza said that the payments to LNG suppliers was entirely a PLL issue for which they would conduct a detailed scrutiny. “PLTL is an entirely separate legal entity and we have to remain within its governance framework. CFO holds a responsible statutory position and like any other employee the PLTL would proceed within the rules and law if and whenever the cause of action is established through formal findings. We have to be fair and just to people and deal with them with responsible conduct.”