Islamabad [Pakistan], November 2 : Pakistan State Oil (PSO) is currently experiencing a severe financial crisis, with total receivables skyrocketing to an alarming PKR 800 billion.
This escalating debt is significantly hindering the company's profitability, which is primarily affected by outstanding payments from major clients, ARY News reported.
The largest debtor contributing to this crisis is Sui Northern Gas Pipelines Limited (SNGPL), which owes PSO a staggering PKR 515.28 billion. Other notable debts include PKR 14.80 billion owed by the Hub Power Company Limited (Hubco), and an additional PKR 189 billion owed to PSO by various entities in the energy sector. Pakistan International Airlines (PIA) has also added to PSO's financial woes with an outstanding balance of PKR 29.25 billion.
Sources indicate that PSO's financial strain is compounded by its own obligations to local refineries for the purchase of imported petroleum products. In response to its growing financial challenges, PSO has sought PKR 50 billion in funding from multiple government ministries to stabilise its operations.
Earlier reports highlighted that the import bill for re-gasified liquefied natural gas (RLNG) has exceeded PKR 506 billion. This has directly impacted SNGPL, which owes PSO the same amount for LNG supplies. Compounding the issue, dues from the power sector have climbed to over PKR 186 billion. Additionally, PIA's debt to PSO stands at approximately PKR 28.75 billion, reported ARY News.
The depreciation of the Pakistani rupee has further exacerbated the situation, imposing an extra burden of PKR 88.84 billion on the government.
Despite the enormity of the outstanding dues, PSO has only received a meagre PKR 10 billion in payments over the past month, signalling a critical liquidity crisis for the company, ARY News reported.
As PSO navigates these turbulent financial waters, the urgency for resolution grows more pressing, underscoring the need for effective measures to recover outstanding debts and ensure the stability of the national oil supplier. The ramifications of this crisis extend beyond PSO, potentially affecting the broader energy sector and the country's economic landscape.
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