No progress on $8b Saudi investment yet

ISLAMABAD:

There had been no progress in the investment of $8 billion by Saudi Arabia in Pakistan, the Public Accounts Committee (PAC) of parliament was informed on Wednesday.

The additional petroleum secretary told the forum that Saudi Arabia was supposed to set up oil refineries in Hub and Gwadar.

However, he added that the plan could not proceed because of the lack of an oil refinery policy.

The official said the draft of the refinery policy was prepared last month.

However, two more months were required for the cabinet's approval and other requirements.

The official further informed the committee that 70% of petrol and diesel are imported because of the lack of capacity of an oil refinery.

Instead of crude oil, $70 million had to be paid extra for the purchase of petrol and diesel.

He added that crude oil was only available from Saudi Arabia on deferred payments.

PAC Chairman Noor Alam Khan observed  that the quality of petroleum products at the Pakistan State Oil (PSO) was very poor.

He reprimanded the PSO managing director for not answering the question about his salary.

In the briefing, it was said that the salary of the PSO MD was Rs3.2 million.

However, he withdrew Rs2.2 million after tax payment while his basic salary was Rs1.6 million.

The PAC chairman noted that the salary of the Sui Northern Gas Pipelines Limited  MD was Rs4 million.

“If asking about your salaries offend you so much, then go home. We will find more competent officials for the job willing to work for lower salaries,” he added.

The Oil and Gas Regulatory Authority (Ogra) chairman told the committee that he had no idea how much petrol would become expensive because of the implementation of levy from next month.

Audit officials informed the forum that the PSO had to receive Rs87.40 billion from various institutions.

They added that the Water and Power Development Authority (Wapda) had arrears of Rs41.8 billion to pay to the PSO, Hub Power Company owed Rs25 billion,  Kot Addu Power Company  Rs16.6 billion and Pakistan International Airlines Rs4 billion.

The audit officials further said a para in the audit had been postponed as Rs36 billion had not yet been paid to the PSO.

The energy secretary told the PAC that the circular debt of his sector had reached Rs2.60 trillion.

He added that in the last four years, the circular debt had increased by Rs1.60 trillion.

The official told the committee that expensive electricity was being generated because of costly imported fuel.

It was told in the briefing that there was no buyer for Afghanistan’s coal except Pakistan.

Before that, Pakistan imported coal from Africa.

However, now the country was buying cheap coal from Afghanistan but the cost of transportation had increased globally.