ISLAMABAD: The Pakistan State Oil has sought Rs40 billion to avoid default on LCs (letters of credit) for payments to overseas suppliers, including the Kuwait Petroleum Company (KPC).

In a letter to the finance ministry, the PSO highlighted its payables and receivables as of Saturday. LC payments to the KPC and other foreign suppliers amount to Rs110.6 billion, while payables to local refineries stand at Rs56.27 billion. The due date for payment of Rs50.97 billion has already passed.

A copy of the letter has been forwarded to the petroleum ministry. The PSO said that refineries were reluctant to supply oil because of the delay in payments and asked the petroleum ministry to influence the finance ministry for the release of Rs40 billion immediately so that the company could ensure supply of furnace oil to power generation units.

Talking to Dawn, a PSO official said that due date for export cargoes was usually 21 days after the berthing of ship and in case of the KPC it is 30 days. “The company needs urgent financial support because due date for many cargoes received two weeks ago is very near,” he added.

PSO’s outstanding against Parco is Rs21.91 billion of which due date for the payment of Rs18.83 billion has already passed. The company has to pay Rs14.60 billion to Attock Refinery Limited, with overdue of Rs12.97 billion.