Power Division has amended Pakistan Energy Sukuk Rules, 2019 aimed at facilitating issuance of Rs 200 Sukuk-II through Pakistan Stock Exchange (PSE).
A senior official of Power Division told Business Recorder that book building of Pakistan Energy Sukuk-II will commence on May 18, 2020( Monday) as all the codal formalities including approval of Discos boards for this purpose have been completed.
The S.R. O. 426(1)/2020 issued on Friday says that in exercise of power conferred by section 28 of the Public Debt Act, 1944( XVIII of 1994), the federal government has directed following amendments shall be made in the Pakistan Energy Sukuk Rules, 2019, which have been previously published vide notification No. S.R.O 357(1), 2020 dated May 7, 2020 as required by sub-section (1) of the said section 28.
According to the notification, in rule 1, in sub-rule(3) for the expression "Private Limited (PHPL)," the expression, "Limited (PHL)" shall be substituted; (b) in rule 2, the words "as notified by the State Bank of Pakistan" shall be omitted;(c) in rule 4, for the expression "agreed with the mandated lead arrangers, hereinafter referred to as MLAs, prior to start of each half year", the words "determined through competitive process in accordance with the terms and conditions decided by the company at the time of issuance of the Sukuk" shall be substituted; (d) in rule 6, for the expression "to the MLAs as per Sukuk terms and conditions, agreed between the company and the MLAs", the words "through competitive process to the investors as per Sukuk terms and conditions determined by the company at the time of issuance" shall be substituted; and (e) in rule 7, for the expression "The Sukuk shall be held by MLAs (Mandated Lead Arrangers) institutions, trusts, funds of all types, bodies corporate including banks, non-banking finance companies and insurance and Takaful companies", the expression "The Sukuk may be held by bodies corporate, banks, non-banking finance companies, insurance and Takaful companies and other for-profit or not-for-profit entities" shall be substituted.
On May 6, 2020, the ECC approved a new mechanism/criterion for disbursement of payments to the power generators in the presence of the subject report to be developed, by a Committee constituted by the ECC of the Cabinet.
The sources said the Cabinet in its meeting had decided to freeze any increase in consumer bills initially for a period of three months, i.e., from April 2020 to June 2020 including freezing any changes in tariff rate on quarterly or monthly basis. The impact of built up for freezing both Fuel Price Adjustments (FPA) and Quarterly Tariff Adjustments (QTA) was worked out as Rs 150 billion. Additionally, for the domestic consumers (consuming up to 300 units), the electricity bill for the months of March, April and May 2020 would be received in 3 installments, the financial impact worked out was Rs 74 billion.
In order to mitigate the cash flow impact of the above-mentioned decisions, ECC of the Cabinet approved the following: ;(i) to provide GoP Guarantee for Rs. 200 billion Islamic Sukuk facility to mitigate negative cash flow impact due to freezing / not passing on the monthly FPA and QTA to consumers, which is currently in process of disbursement ;(ii) to provide additional Guarantee of Rs.100 billion for raising additional cash from commercial banks as Syndicated Term Finance Facility (STFF) through Power Holding Limited to mitigate cash flow impact resulting out of staggering of consumer billing for 3 months, which was also in its advanced stage of disbursement by end of April, 2020.
The sources further stated that in the recently unveiled report titled "Power Sector Audit Report" prepared by the committee for the power sector audit, circular debt resolution and Future road map has been presented to the Government. This report alleges excess payment to IPPs as a consequence of tariff determinations and systemic failures. Considering the importance of the findings of the report which has been discussed in the cabinet, the Power Division feels that the disbursal of the amount be done without seeming to be in contradiction of the report.
Power Division has to disburse Rs 300 billion (Rs 200 billion + Rs 100 billion) through CPPA-G to Power sector entities including the power generators in private and public sector for system operation during the summer season.
Comments
Comments are closed.