October 22, 2003	Wednesday	Sha’aban 25, 1424

ISLAMABAD, Oct 21: The privatization of Pakistan State Oil, which was scheduled for December this year, could be delayed till the first quarter of 2004 with the consent of three prospective bidders.

Informed sources told Dawn here on Tuesday that the privatization of PSO, which was to take place first in April and then in October, is not likely to be undertaken even in December as was hinted at by some senior officials of the Privatization Commission recently.

Kuwait Petroleum Company, Midrock of Saudi Arabia and Fauji Foundation are the only three bidders who have expressed their willingness to take part in the privatization of what is termed a “mighty trend setter transaction”.

The Kuwait Petroleum officials had met Privatization and Investment Minister Dr Hafeez Sheikh before he left for Malaysia and asked him to delay the transaction by late December or early next year. The Saudi company, on the other hand, has reportedly proposed that the PSO transaction should be undertaken after winter holidays preferably in January 2004 or beyond.

Sources said that foreign companies like Shell, Total and Caltex have not shown much interest in the PSO transaction, saying that under the prevailing circumstances, they would continue adopting the ‘wait and see’ policy.

Some officials within the government believe that the PSO privatization should be undertaken through stock market where people are investing heavily.

But the Privatization Commission officials maintain that PSO is such a huge organization that it required sale of 51 per cent shares to a strategic buyer along with the transfer of management.

Others claim that the PSO privatization is being delayed to allow some unscrupulous stock exchange players to make several big killings as after the announcement of every new date for the PSO privatization the share prices of the organization jump steeply and then come down when this followed after a fortnight or so by an announcement of delay in its sales.

It is also said that the Ministry of Petroleum officials are resisting the disinvestment of PSO and are raising various objections every now and then. “We keep receiving queries from the Ministry of Petroleum officials and they are never satisfied and this shows that they are not very much enthusiastic about the disinvestment of the PSO like the Privatisation Commission is,” a source said.

The sources said the financial adviser for PSO sell-off, JP Morgan, had been insisting the Privatization Commission to get various controversial issues sorted out so that the company could be privatized as early as possible.