Rs84bn payments to PSO: SNGPL sends SOS to PD

ISLAMABAD: Sui Northern Gas Pipelines Limited (SNGPL) has sent an SOS to Petroleum Division for intervention for payment of Rs 84 billion to clear the planned payment of PSO till May 31, 2024, besides equalization of gas rates at par with SSGC.

In an SOS to Director General (Gas) Petroleum Division, General Manager Account, SNGPL, Raheel Farooq, referred to severe financial challenges being faced by SNGPL in managing payment obligations towards RLNG and indigenous gas supply chain.

SNGPL noted that against the committed amount for RLNG supplies for the month of May-24 Rs 24.5 billion (April shortfall Rs 13.5 billion and May -24 projected supplies value Rs 112 billion), SNGPL has so far (till May 16, 2024) paid Rs 41.5 billion to Pakistan State Oil (PSO), still leaving balance of Rs 84 billion.

The gas utility company has claimed that based on the amounts due from power and Sui Southern Gas Company Limited (SSGCL), the plan for payment to PSO during the balance days of May-24 is contingent upon the following: (i) power sector( balance for the May-24, against supplies value Rs 79 billion is Rs 59.60 billion; (ii) SSGCL (2nd fortnight invoice April-24, overdue) net amount, Rs 1.94 billion; (iii) SSGCL (1st fortnight invoice May-24) due on May 22, 2024 Rs 5 billion; (iv) RLNG diversion subsidy (leftover balance against CFY budgetary allocation, case to be re-initiated by MoE-PD)Rs 7 billion; (v) fertilizer sector subsidy (case to be taken up with MoI&P and MoF), Rs 1 billion ; and (vi) balance out or normal collection/additional borrowings, Rs 9.46 billion. Total planned payments to PSO (May 13 to May 31, 2024) is Rs 84 billion.

According to SNGPL, all stakeholders must play their role in discharging their obligations to ensure continuity of RLNG supply chain, avoiding default of PSO and as part of this arrangement, permanent long-term, solutions are required to address the situation. In this regard timely discharge of commitment by power and SSGCL and release of pending subsidies are crucial for SNGPL to make timely payment of balance amount to PSO till May 31, 2024 as per the plan.

“We request Petroleum Division to intervene and help in expediting the realization of committed amount/contingent items.