KARACHI (PR) - PSO, the country’s largest oil marketing company, recently found itself in the middle of an unprecedented controversy after cross sections of the local media reported the launch of an investigation against the company’s senior management and alleged subsequent attempts by some company officials to flee the country. Pakistan’s anti – corruption body, National Accountability Bureau (NAB) had moved to probe alleged back-door inductions against senior positions at the company, a shady LNG deal and an apparently preventable loss of millions of rupees to the national exchequer incurred through planned demurrages.

PSO has since fervently refuted the allegations and has expressed its complete support in the investigation process which the company believes will clear all the unwarranted allegations. The situation will clear up after the law has taken its course, but contrary to the media hullabaloo, the company’s performance under the incumbent leadership presents a different and very optimistic picture.

The reason the company is unwilling to capitulate to the mounting pressure is its extraordinary operational and financial performance under the current management with which it seeks to respond to the barrage of suspicion and criticism. From its core businesses of fueling the nation, to retail modernization, the company has effectively transformed itself under the same people at the helm in order to best serve its customers’ needs in a highly competitive market.

Over the past three years, PSO has strengthened its financial position. During fiscal year 2017, the company posted an impressive 163 percent increase in profit after tax against that in FY2015. Similarly, for the same period the sales volume witnessed a 37 percent growth, earnings per share grew by 163 percent, net profit margins by 174 percent, and dividend at a whopping 170 percent, which all attest to the focus, dedication, effective management, and strong execution at all levels of management.

Despite multiple challenges at different levels, the company, through its nationwide retail footprint and massive three pronged oil transport system has been functioning like a well – oiled machine to fuel the nation from Karachi to Khunjerab.

Improving fuel quality in Pakistan is one area where the company has invested a lot of focus. The present PSO management, in coordination with the Ministry of Energy, transformed the fuel quality in the country through the import and marketing of higher grade Motor Gasoline and High Speed Diesel. The move did away with the lower grade fuels that adversely affected engine performance and resulted in the infamous ‘engine knocking’. These fuels, along with the recently introduced RON 97 High Octane Petrol, enhance engine efficiency, improve the driving experience, and are better for the environment.

To transport this quality fuel safely to the users, PSO has started transforming its road transportation fleet by inducting the latest OGRA and NHA compliant tank Lorries into its fleet. In addition, PSO has increased its use of rail transportation as well through Pakistan Railways. Moreover, with the introduction of Fuel Cards with digital services, rebranded “Stop Shop” convenience stores, Branchless banking facilities, ATMs, and other non- fuel retail services, PSO is transforming itself and the consumer experience at its outlets.

Contrary to the recent propaganda, PSO is one of the highest contributors to the national exchequer, with Rs 319 billion in direct taxes contributed during fiscal year 2017. Besides the massive economic activity and employment opportunities generated by its country – wide retail network and its recently mobilized non – fuel retail activities, the company has a role in the country’s socio – economic progress and human development which is hard to disregard conveniently. Transcending beyond its ambit, the company has been impacting growth and progress of other sectors and allied industries by leveraging its expertise in the field.

PSO supports the local oil refining industry in enhancing its efficiency and productivity. The company has been making timely payments of Rs 400 billion to the industry to uplift its throughput. Moreover, the power sector, and a number of other public and private sector entities extending valuable services to the society also heavily rely on PSO for effective execution of their responsibilities. Experts emphasize that the company is indispensable to the smooth running of the economy, and needs to keep its enthusiasm and focus intact to be able to continue its role in the progress of the nation. That’s perhaps, the reason the company has been fighting desperately to ward off the campaign which it vehemently terms malicious, false, and damaging to its reputation, and could result in disruptions to its supply chain with potential dry outs.

PSO says it has been functioning under demanding circumstances to make up for the nation’s rising fuel needs with the circular debt being a major setback to the company’s smooth operations. By May 31st 2018, the company’s total major receivables from the power sector, PIA and LNG stood at Rs 307 billion. Due to these huge receivables, PSO has been facing acute working capital constraints which impact its white oil business and ability to hold adequate inventory levels and may eventually lead to a major fuel crisis in the country. The company is said to have limited fiscal space to invest in capital projects including refinery, pipelines and storage and it has been incurring about Rs 7.5 billion financial charges per annum since FY2014 on financing these public sector receivables.

Among the impediments to its growth, the company has particularly expressed its discomfort with the current regulatory regime over its matters with the Oil and Gas Regulatory Authority. The company believes that the regulatory body’s freight management system is porous enough to be systemically exploited by other oil marketing companies to damage PSO’s legitimate businesses. Amid the fake news on the alleged corruption of its management, the company’s genuine concerns are likely to go unnoticed. However, the nation’s largest oil marketing company needs to be strengthened and allowed to function at its full capacity in a challenging regulatory and media environment so that it can effectively deliver on its long standing commitment of ensuring the smooth running and growth of the economy, and the prosperity of the people of Pakistan.