Pak oil refineries in 'lower production mode'

Pakistan’s oil refineries, running at 60 per cent of their production capacity, currently have petrol stocks that are adequate for only four days, a media report said on Thursday.

“The refineries are not running at their maximum capacity because of fiscal constraints despite the fact that the government earlier arranged a sum of Rs 9,200 crore to minimise the adverse impact of circular debt in the energy sector,” a senior official told The News Daily, adding the petrol stocks were enough for four days.

“But still the remaining part of the debt has triggered fiscal constraints due to which it is unable to clear the dues of refineries,” he added.

In the face of lower production by refineries, the government has been compelled to import petrol.

Pakistan State Oil (PSO) Managing Director Irfan Qureshi refused to divulge details but acknowledged that refineries were in a “lower production mode” and his organisation would open a tender for importing petrol on Thursday.

PSO has adequate stocks of other oil products as the country has enough furnace oil, which is available for 17 days’ consumption and High Speed Diesel for nine days.

An official at the petroleum ministry said PSO is “in deep waters again” as it is yet to be paid Rs 1,509 crore by the water and power department, Rs 1,506 crore by Kot Addu Power Company and Rs 270 crore from Pakistan International Airlines.

“Hub Power Company, an independent power producer, owes Rs 2740 crore to PSO,” the official said. The Pakistan government too owes Rs 500 crore to PSO.

The delay in payment of dues has prevented refineries from operating at 100 per cent production capacity.