ISLAMABAD: The Pakistan National Shipping Corporation (NSC) management is likely to come under hard situation because the Federal Investigation Authority (FIA) is about to shift focus of investigation from Pakistan State Oil (PSO) to the PNSC.
The FIA has been given deadline of February 15 to complete its report and present before the Senate body. FIA is carrying out an investigation into the import of substandard furnace oil causing loss of Rs 10 billion to the company. FIA initiated the investigation into the matter after two months of appointment of sitting MD PSO Amjad Janjua on September 24, 2013.
Due course of the proceedings of the Senate Committee here on Friday, the senators criticized the FIA for not completing the inquiry in last 18 months as well as keeping strict focus on PSO and ignoring the PNSC.
The House was informed that through an international mechanism, the quality of imported furnace oil was checked and verified at Malaysia, however, its quality was found substandard on its arrival in Karachi. Therefore, something wrong went to the imported product due course of transportation from Malaysia to Karachi’ the secretary Petroleum Abid Saeed was categorical before the committee.
The FIA Inspector argued that as per federal government’s decision made in 2007 PSO was not authorized to off load the substandard furnace oil, however, MD PSO Amjad Pervaiz Janjua briefed the committee that as per the Contract of Affreightment (CoA) the PSO was getting damages, because CoA provided no cover to any contamination made during the transportation of the product. He added that PNSC had sued the court for seeking PSO not to quit the CoA.
PNSC and PSO entered into a memorandum of understanding (MoU) in August 2012 and thereafter, signed a CoA after two months, i.e in October, followed by an addendum in January last year. The CoA was stated to be “evergreen” but at the same time was valid for a period of three years and then automatically extended for another period of three years with mutual consent unless a notice of termination is .served. As per CoA, PNSC had to transport PSO’s Furnace Oil in an estimated quantity of three million tonnes per annum (MTPA) plus/minus 10% which after the Addendum was extended to include transportation of Motor Gasoline (estimated quantity of 1MTPA) and Low Sulphur Fuel Oil.
The Senators strongly criticized the FIA keeping focus on PSO and not holding the PNSC answerable in this issue. Senators namely Abdul Nabi Bangash, Deputy Chairman Senate Sabir Ali Baloch as well as others also asked the FIA to expand jurisdiction of investigation to bring the PNSC administration under the ambit of interrogation in this regard. FIA team accepted and promised to finalize the inquiry report by February 15, 2015 and preset it back to committee.
It is pertinent to note here that at the time of signature of CoA between PSO and PNSC, the Transparency International Pakistan (TIP) strongly criticised this act of both the stated owned enterprises because PNSC had been authorized to handle transportation imports of PSO without of any competition of bids.
