ISLAMABAD, Jan 6: As the nation suffers from its worst-ever power cuts, about 250,000 metric tons of furnace oil available in the official reserves cannot be provided to the power-generation companies of Wapda and independent power producers (IPPs) because they cannot pay for it.
Official sources told Dawn that at the heart of the problem was a burgeoning inter-corporate debt that crossed Rs180 billion in recent months despite the release of about Rs35 billion by the government to the two leading oil companies through commercial loans and to the IPPs. The power companies were still finding it impossible to pay for the fuel oil, they said.
These sources said the ministry of petroleum and natural resources and the Pakistan State Oil (PSO), in a presentation to the caretaker prime minister, have claimed that the fuel shortage did not develop due to recent protests as was wrongly portrayed by some of the IPPs and Wapda companies.
They said the situation had emerged in July last year and since then the PSO has been reminding the power companies and IPPs every month to build up their stocks. The Wapda and IPPs, however, failed to improve their oil stocks due to their cash problems and the PSO had to cancel at least seven orders for fuel import since July.
The sources said the petroleum ministry and PSO also informed the caretaker prime minister that the PSO had furnace oil stocks of about 250,000 metric tons as of December 5 but its supply could not be restored to Wapda and IPPs due to payment problems despite the fact that rail and road transportation of oil products had resumed.
The PSO and Wapda-Pepco authorities had detailed discussions over the issue where the PSO was requested to provide fuel supply on deferred payment of about 60 days. The petroleum ministry and the PSO have, however, put their foot down that the non-payment of price differential claims (PDCs) to the oil companies had already increased to about Rs45 billion this month and hence they could not provide furnace on a 60-day credit. As a result furnace oil stocks available with public sector power companies depleted to 8-10 days requirement on Saturday while those with IPPs fell to 2-4 days.
