Stealing billions: G-B a success story for ‘oil gang’

GILGIT: Gilgit-Baltistan (G-B) has become a ‘goldmine’ for people dealing in oil. Billions of rupees have been allegedly embezzled over the past decade by fudging petroleum freight subsidy figures by the hands of such individuals, sources disclosed on Thursday.

The inland shipment subsidy is offered to ensure uninterrupted supply of petroleum products and keep their prices stable in the remote areas. But, a ‘gang’ has been misusing the subsidy for over a decade, according to a recently published Pakistan Economy Watch (PEW) report.

“Presently, many petrol pumps with an actual sale of 40-50,000 litres of petroleum products in G-B show sale of four to 500,000 litres, depriving the government of billions of rupees,” said PEW President Dr Murtaza Mughal in his report, the ‘first attempt to uncover embezzlement in supply of petroleum in the region’. He added that an oil tanker may currently charge a fare of up to Rs75,000 for Gilgit, while the cost escalates to Rs100,000 for Skardu and Hunza.

“It takes five days for a carriage vehicle to deliver petroleum products to Gilgit and return, but tankers belonging to the ‘gang’ are paid fares for four to five trips in a week, which is amazing,” he said.

According to Dr Mughal, some influential politicians, oil marketing companies (OMCs), officials of the Ministry of Petroleum, Oil and Gas Regulatory Authority’s (Ogra) officials and carriage contractors are involved.

“Following deregulation in Musharraf’s era, dozens of OMCs cropped up, some only on paper,” wrote Dr Mughal in his report, adding that these companies load petroleum products from Rawalpindi and Mahmood Kot, Multan for G-B and charge fares from the government without actually taking the supplies to their designated place.

Later, in collusion with an influential group, OMCs established dozens of petrol pumps in G-B for the sole purpose of filing fake orders.

Dr Mughal said that a proper system to verify the sales of OMCs and audit filling stations is yet to be established. Pakistan State Oil (PSO) did establish a depot in G-B, but other OMCs were never asked to conduct business through that facility. “Rather, direct sales were preferred for obvious reasons,” he said.

Dr Mughal demanded the chief justice and other officials take notice of the plunder and recover the looted wealth.

When contacted, a senior Pakistan State Oil (PSO) official in Islamabad told The Express Tribune, it was PSO that had insisted on physical verification of the oil tankers in Jaglote Depot. “For the past five months, oil tankers are being checked at Jaglote Depot before further distribution of fuel to other areas,” the official said requesting anonymity. He said that PSO also resisted undue increase in the fare of tankers only to check the malpractice, if any.

Another senior official, in PSO Gilgit, said that PSO was not a regulatory agency for the sale of petroleum in G-B, adding that it was the duty of Ogra and the government to keep a check on all such companies.

Published in The Express Tribune, February 20^th, 2011.