ISLAMABAD, May 14: The oil marketing companies and refineries have threatened to pull out their $1 billion investment of the country if the government accepts National Accountability Bureau’s proposal to recover Rs4.5 billion from them, it is learnt.
According to sources, major private and foreign companies — Shell, Caltex, Attock Oil, Parco and Bosicor — have either held meetings with or written letters to the prime minister and the ministry of petroleum with the demand to shelve ongoing Nab investigations into oil pricing and restore their old profit rates.
As a result, sources said, the government was likely to close the investigations into the oil pricing scam, second in row after shelving an investigation into sugar pricing last month.
Sources said the NAB had asked the government to recover Rs4.5 billion from the refineries and marketing companies for not passing on the benefit of international price reduction to the consumer for nine fortnights since May 2004.
The companies have taken the stand that if the government decides to recover the amount, they would prefer to wind up their businesses because they work strictly in accordance with the policy and price fixation formula provided by the federal government.
The oil industry has also contended that they were allowed 3.5 per cent commission which was calculated after inclusion of general sales tax in the price build up. However, a recent government decision to exclude GST from the price build up has reduced their profit margin to 2.7 per cent. Similarly, the exclusion of GST from the price mechanism has reduced the dealers’ commission from four to three per cent.
