Oil & Gas firms’ receivables mount to Rs 338b

The Ministry of Petroleum and Natural Resources has asked the Prime Minister to intervene as the receivables from power producing companies soar to Rs 338.37 billion in fear of disruption to the supply chain, reported a national daily.

The petroleum ministry has asked the Ministry of Water and Power to release funds for the clearance of oil and gas suppliers on an immediate basis.

Pakistan State Oil (PSO) is the only state-owned oil and the largest oil supplier to power producing companies. In order to facilitate smooth power generation in the country, PSO has agreed to supply fuel to power companies on government’s orders.

PSO’s receivables have risen to 228.20 billion including receivables from SNGPL for supplying liquefied natural gas (LNG).

Similarly, receivables of Sui Southern Gas Company (SSGC), Sui Northern Gas pipelines Limited (SNGPL), Oil and Gas Development Company (OGDC) and Pakistan Petroleum Limited (PPL)  have also peaked to soaring levels.

The current situation has jeopardised the liquidity situation of the oil and gas companies and a further delay will cause them to default on payments to local and foreign oil suppliers hence disrupting the supply chain.

In a summary sent to the Cabinet Committee on Energy chaired by the prime minister, the Petroleum Minister has asked the Ministry of Water and Power for early settlement of dues given the current state of affairs.  

According to the breakdown, power producers owe Rs55.96 billion to OGDC, Rs28.18 billion to SNGPL, Rs19.27 billion to PPL and Rs8.76 billion to SSGC.

PSO is to receive Rs19.8 billion from power generation company (Genco)1, Rs110.9 billion from Genco 3 , Rs66.4 billion from Hub Power Company and Rs20 billion from Kot Addu Power Company (Kapco).

Government Holdings Private Limited is a major defaulter of OGDC and has to pay Rs49.4 billion and PPL is to receive Rs19.27 billion from Genco 2.

Pepco is a major defaulter of SNGPL and has to pay Rs17.83 billion on account of gas supply. SNGPL is also to receive Rs3.33 billion from power producers on account of re-gasified LNG supply.