Resolution of outstanding payments issue: IPP's top executives hastening to Islamabad to convince government

Threatened with serious financial crisis, the top managements of all the Independent Power Producers are hastening to Islamabad today (Thursday) to try to convince the government that unless outstanding payments are made immediately they will be forced to shut down their plants, well-placed sources in the PPIB told Business Recorder.
Pakistan Electric Power Company (Pepco) has already communicated to the federal government that IPPs have threatened to call GoP guarantee and if this happens it would have disastrous consequences for the national economy and Pakistan's credit ratings, the sources added.
"We are holding a crucial meeting today with the Minister for Water and Power for recovery of outstanding payments against Pepco and any delay will result in shut down of our plants," said one of the CEOs on condition of anonymity. The meeting is scheduled to be held in the PPIB office, which deals with IPPs.
According to the Pepco, Pakistan State Oil had threatened to suspend furnace oil supplies to public sector power generation companies and IPPs.
In order to restore furnace oil supplies for Hubco, Kapco, AES Lalpir and Gencos, Pepco Managing Director talked to Kaleem Siddiqui, Executive Director (Customer Service) PSO on August 12 and assured that all the remittances from Discos between August 15 and 23 will be transferred to Hubco, Kapco, AES Lalpir and Gencos for onward payment to PSO. Subsequently, the Executive Director of PSO assured that they would immediately restore furnace oil supplies to these plants.
As per understanding all the available funds of Rs 240 million and Rs 420 million with the Pepco on August 15 and 16 respectively have been transferred to IPPs and Gencos for onward payment to PSO.
However, the Pepco says that furnace oil supplies of Kapco and AES Lalpir have not been restored so far.
According to the Pepco, furnace oil pumping from PSO's Lalpir was stopped on August 10. Eight oil specials already at Kapco are waiting for PSO instructions for decantation. Same is the case with supplies to AES Lalpir through road tankers where a number of tanks lorries have been accumulated but are not being decanted. The Pepco, in its letter written two days ago had also accused PSO of offering short supply ie 10,000 tons HSFO against fortnightly demand of 85,000 tons. "We are discussing all the issues which hav not only disturbed the IPPs but also the government," the sources concluded.