Public Accounts Committee (PAC) expressed displeasure over loss of $11.7 million by paying advance of $17.7 million to Club Engineering for procurement of equipment for Dakhni Gas Condensate Field and directed the Secretary Petroleum to submit a detailed report as to how the amount would be recovered and fix the responsibility.
The Oil and Gas Development Company Limited (OGDCL) should take the responsibility that it has caused $11.7 million loss to national exchequer, said Yasmeen Rehman, Chairperson of Monitoring and Implementation Committee of PAC here on Tuesday.
The special committee of PAC met here in the Parliament House with Yasmeen Rehman in the chair, while MNAs Hamid Yar Hiraj, Ghulam Mustafa Shah and Haider Abbas Rizvi were other three members of the committee. Auditors along with Secretary Ministry and heads of sub departments of the ministry were also present in the meeting.
The committee reviewed different audit paras of the Ministry of Petroleum and OGDCL and expressed dismay over non-implementation of the PAC instructions. The special committee also lamented the Audit Authority, saying that how this para in which an amount of $11.7 million was missing was brought in the PAC for settlement.
The secretary petroleum, responding to queries of the special committee of PAC said that the contract was given to Club Engineering for laying second train-track in Dakhni Gas Condensate Field. The company was paid Rs 492 million in advance for laying a train in the project area in 1996.
Dakhni Gas Condensate Field is located at a distance of about 135 Kms south-west, Islamabad. The field was discovered in February, 1983 and started giving regular production in December 1989. Gas contains 6-8% H2S in the well stream. The secretary informed the committee that when OGDCL withdrew the contract the company claimed that it has prepared trains for laying and claimed $25 million. The issue was taken by National Accountability Bureau and the company came out of court settlement and paid $6 million in place of total $17.7 million, he added.
The secretary petroleum also informed the special committee that total amount of circular debt is Rs 344 billions and Pakistan State Oil (PSO) was the biggest one indebted with an amount of Rs 160 billions. Responding to a query by Haider Abbas Rizvi, Chief Financial Officer of the OGDCL stated that the company had Rs 130 billions as receivables from other institutions including five refineries and hopefully the whole amount would be recovered.
He further observed that commonly advance payments of up to 10 to 20 percent was made to good reputed supplier companies, however, no advance payment was made to foreign companies in cash as it was made through LCs. The PAC special committee while reviewing another audit para of OGDCL regarding the award of contract of Rs 11.312 billion on fake bank guarantees of Rs 11.312 million from the company.
The committee directed the OGDCL to ensure submission of complete report of the inquiry, as to why the fake bank guarantee was accepted and later on another bank guarantee from the same company was also accepted. The committee was informed that National Bank of Pakistan Multan branch has issued bank guarantee of Rs 11.312 million, which proved fake. Inquiry was conducted and six persons were found guilty. Four of the responsible persons have been retired while two are still working with some other ministries. The committee directed the secretary petroleum to take action against the persons found guilty.