Steel mill’s revival plan hits snag

Govt fails to get NOC for gas supply to PSM’s new subsidiary

ISLAMABAD:

The revival of Pakistan Steel Mills (PSM) has hit a snag as Sui Southern Gas Company (SSGC) is reluctant to give no-objection certificate (NOC) for utility connection to the newly formed subsidiary – Steel Corp (Pvt) Ltd.

On the other hand, K-Electric gave its NOC to the Ministry of Industries, which forwarded it to the Privitisation Commission for further processing.

Earlier, the Cabinet Committee on Privatisation (CCOP) directed the Ministry of Industries and Production to ensure completion of all corporate actions and regulatory requirements for the approval of Scheme of Arrangement (SOA) for the efficient and successful completion of this important transaction.

The cabinet body also directed the Privatisation Commission to invite Expressions of Interest (EOI) from interested parties for the revival of PSM, after the filing of SOA with the Securities and Exchange Commission of Pakistan (SECP).

Major focus of the government is on availability of utility connections for the newly formed subsidiary of PSM, which is mandatory for seeking approval for SOA.

The matter has been taken up with utility companies and National Electric Power Regulatory Authority (Nepra) for the issuance of NOCs to complete the process of privatisation/ revival of PSM within the stipulated time period and without any hindrances.

Sources said that K-Electric had given NOC and said that it would settle the dispute over receivables later.

However, SSGC was not ready to grant the NOC and wanted PSM to allot its land against receivables on account of gas supply.

The Ministry of Maritime Affairs has pressed SSGC to utilise the land it plans to acquire from PSM for use by the new LNG terminals being set up by Energas and Tabeer Energy. It wants to use the land for establishing a tie-up point.

According to a statement issued on Thursday, Federal Minister for Industries and Production Makhdoom Khusro Bakhtiar chaired a consultative meeting on the revival of PSM.

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The meeting sought to address the issues pertaining to completion of privatisation of PSM and Heavy Electrical Complex (HEC). The meeting was briefed about the status of privatisation of PSM and HEC.

It was noted that the process of privatisation of HEC was nearing completion and its pre-bid conference was held at the Privatisation Commission while the bidding process is scheduled to be held on January 12, 2022.

The meeting was informed that the pre-qualification bidding process of PSM was under progress.

While chairing the meeting, Bakhtiar remarked that the main objective of privatisation of the under-utilised public sector entities was to monetise their assets by enhancing investment opportunities.

He said that the space would be filled by the private sector, which would bring investment as well as best global practices. He added that the private sector would also introduce modern technology and a change in the mindset of management, which would create more efficient jobs and increase the efficiency of the system.

Federal Minister for Privatisation Muhammad Mian Soomro said that privatisation was an integral part of the economic development agenda of Pakistan.

He reiterated that privatisation of under-utilised public sector enterprises would be completed in a transparent and efficient manner in line with the best global practices.

In the meeting, industries and privatisation secretaries, representatives of HEC and financial advisers were present.

 

Published in The Express Tribune, January 7^th, 2022.

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