ISLAMABAD - PSO’s signing a fuel procurement agreement with M/s Bakri Trading Company Pakistan (Pvt) Limited, which is only a trader and not a refiner, has raised serious questions about the decision of state-owned oil giant to rely on a trader for strategic oil supplies primarily meant for power sector.

What was the need to secretively involve a particular company only? Why wasn’t the matter discussed and deliberated in Man-Com? Why were PPRA rules violated so openly? Why was the supply arrangement tied to a five years period?

Background interviews and discussions made with energy experts over this issue of national interest pertaining oil supplies by BTCPL to PSO had raised above mentioned questions of utter importance demanding to be addressed as early as possible by concerned quarters as sheer mockery and utter violations of prescribed rules were done in a ‘controversial’ locally blended fuel oil procurement agreement. They unanimously said that PSO’s signing $5 billion agreement with M/s BTCPL in a reticent way in which the whole deal was progressed and executed needs thorough investigation/review. Highly controversial clauses were included in the agreement by the decision makers at PSO ostensibly succumbing to the pressure of their political patrons.

The energy experts while talking to this scribe further pinpointed various controversial clauses of the agreement that are mentioned in the following:

“The quantity, temperature and specific gravity of the HSFO delivered to PSO terminal shall be measured by taking initial and final dip of PSO’s storage tanks undertaken by jointly appointed independent surveyor (cost of which shall be shared equally). The surveyor’s report shall be final and binding on the parties and not open to dispute,” the agreement reads.

As per agreement for sale purchase of High Sulphur Fuel Oil (HSFO), which was secretly signed on a holiday (19th May) at Karachi, PSO would procure 14 lakh tons of furnace oil from M/s BTCPL for five years and after completion of the said span of time the agreement would be extended with mutual consent. However, in case of war, emergency and bad law and order like situation the company would not be bounded to provide fuel oil, adding that in case of emergence of any dispute, the legal remedy would be sought only at Karachi. Furthermore, PSO and M/s BTCPL would jointly check oil quantity and quality and in case of if PSO refuses to procure oil then it (PSO) will have to pay the price of oil along with losses.

Following the revelation of the Board Audit Committee (BAC) of PSO pertaining alleged ‘mega corruption’ done in oil procurement deal, the decision-makers at PSO hand in glove with their political patrons in an apparent bid to hush up the matter had also succeeded in revising the composition of Board of Directors (BoD) of the company by getting the approval of Prime Minister Raja Pervez Ashraf. Top management at the state-owned oil giant had also been found successful in luring the baboos at the Ministry of Petroleum & Natural Resources (MP&NR) to get the Premier’s nod to replace two members of PSO board of directors who raised this issue in Board Audit Committee and were part of the enquiry committee against that deal, well-placed sources earlier said.

Official letter No. 5(6)/2008-Gas of the Ministry of Petroleum & Natural Resources dated 30th October available with The Nation further disclosed that revision in the composition of PSO BoD had been done on 30th October. Dr Abid Qaiyum Suleri, Hammayun Jogezai have been removed from company’s BOM as Sarfraz Bugti and Ikhtiar Baig have been now included in the composition of BoD.