KARACHI: Pakistan State Oil Managing Director Syed Muhammad Taha has said that empowering the board of management with regulatory powers is critical to ensuring the company’s sustainability and enabling it to compete effectively in an increasingly challenging market.

During a meeting of the Senate Standing Committee on Petroleum held at the PSO headquarters on Thursday to review the challenges facing the energy sector, Mr Taha explained that 14pc of PSO’s circular debt is equivalent to its EBITDA [earnings before interest, taxes, depreciation, and amortisation] for FY23, highlighting the severity of the issue.

He further detailed challenges such as trapped equity, price competition, investment stagnation, discount dumping, and franchise exploitation. While discussing regulatory challenges, he demanded complete commercial autonomy by empowering the board. “PSO has been the largest buyer of furnace oil for power plants and is currently the largest buyer of LNG in the country for onward sale to SNGPL,” he noted. “This strategic role, however, has created an enormous circular debt burden, eroding profits and restricting growth,” Mr Taha said.

Sui Southern Gas Company Ltd Acting Managing Director Muhammad Amin Rajput while providing an update on the company’s curtailment of gas supply for captive power generation from January and its impact on the industrial sector, informed the Senate committee that the company is closely monitoring the situation to mitigate the adverse effects of gas supply curtailment on industries. He added collaborative efforts with stakeholders are essential to address this challenge effectively.

Senator Quratul Ain Marri said “we must ensure that our policies are not only sustainable but also enable public sector entities to thrive in a competitive environment.”

Committee Chairman Senator Umar Farooq, while stressing the importance of collaboration between public sector entities and the government, said, “The challenges faced by PSO, SSGC, and Pakistan Petroleum Ltd require immediate attention. This committee stands united in its commitment to finding sustainable solutions for the energy sector.”

Published in Dawn, January 24th, 2025

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

From hard to harder

From hard to harder

Instead of ‘hard state’ turning even harder, citizens deserve a state that goes soft on them in delivering democratic and development aspirations.

Editorial

Canal unrest
Updated 03 Apr, 2025

Canal unrest

With rising water scarcity in Indus system, it is crucial to move towards a consensus-driven policymaking process.
Iran-US tension
03 Apr, 2025

Iran-US tension

THE Trump administration’s threats aimed at Iran do not bode well for global peace, and unless Washington changes...
Flights to history
03 Apr, 2025

Flights to history

MOHENJODARO could have been the forgotten gold we desperately need. Instead, this 5,000-year-old well of antiquity ...
Eid amidst crises
Updated 31 Mar, 2025

Eid amidst crises

Until the Muslim world takes practical steps to end these atrocities, these besieged populations will see no joy.
Women’s rights
Updated 01 Apr, 2025

Women’s rights

Such judgements, and others directly impacting women’s rights should be given more airtime in media.
Not helping
Updated 02 Apr, 2025

Not helping

If it's committed to peace in Balochistan, the state must draw a line between militancy and legitimate protest.