By Khaleeq Kiani
Dawn

At least two premier intelligence agencies have started investigations into some multi-million dollar oil and gas transactions, including the proposed setting up of 100 ‘autogas’ filling stations and furnace oil import.

According to sources, a team of Inter-Services Intelligence (ISI) and Military Intelligence (MI) has collected record of the proposed transactions and interviewed the managing director of the Pakistan State Oil (PSO) and some senior officials of the petroleum ministry.

PSO managing director Irfan K. Qureshi told Dawn on Monday that he had shot down the proposed agreement between his company and the Associated Group owned by Iqbal Z. Ahmed for setting up LPG filling stations because it was not in PSO’s interest. ‘At least five clauses of the agreement prepared by the Associated Group (AG) were detrimental to the interest of the PSO. My legal team proposed certain amendments that were rejected by the AG. Therefore, I have decided to sustain all pressure and not to enter into an agreement that is against the interest of my company and the government,’ he said.

‘I will not accept any pressure and will re-tender the LPG project to ensure transparency,’ he said.

Mr Qureshi said the autogas project was very important to improve the financial position of the PSO because CNG was a dying business and he wanted to replace it with LPG filling stations to ensure smooth cash flow.

He said he was a professional and ready to face an investigation pertaining to his company’s business since March 4 when he assumed responsibilities of the PSO.

The sources said that two teams of the PSO and the Associated Group held a meeting in Karachi on Monday in an attempt to narrow down differences on the controversial clauses of the proposed agreement.

The issues of filling stations and import of furnace oil were also taken up by the Senate Standing Committee on Petroleum and Natural Resources. Senator Haroon Akhtar presented Monday’s issue of Dawn before the committee and members asked the PSO management questions about the transactions. Mr Qureshi told the committee that the prime minister’s secretariat had not stopped signing of the autogas agreement. In fact his legal team had objected to certain clauses of the agreement, he said.

He assured the committee that any transaction not in the interest of the PSO would not be signed and every aspect of the deal would be transparent.

About the furnace oil import, Mr Qureshi said his company had been at the receiving end of the circular debt and its receivables from the power sector stood at more than Rs67 billion. He said the Attock Oil had to pay over Rs22 billion to the Oil and Gas Development Company (OGDCL), while it had to receive about Rs18 billion from the PSO. Since the government’s revenue was held up with the OGDCL because of the Attock Refinery’s payables, the government had not been able to clear PSO’s dues, resulting in cash flow problems, he said. If the refineries cleared their dues to oil producers, cash flows of many energy sector companies would improve, he said.

Mr Qureshi said the decision to import furnace oil in large quantities was taken by the product review committee headed by the director general of oil to meet higher power sector requirements. He said that PSO was importing less furnace oil during November and December for optimal utilisation of its inventories which were earlier built up on the instructions of the government to meet any abrupt demand of the power sector.