ISLAMABAD:
State-run oil marketing company Pakistan State Oil (PSO) is facing a financial setback as receivables of around Rs30 billion remain stuck at Pakistan International Airlines (PIA) after the air carrier failed to transfer its real estate asset to settle the outstanding dues.
The government had declared a consortium, led by the Arif Habib Group, the winner in the bidding process for the acquisition of a 75% stake in PIA. The group submitted the highest bid of Rs135 billion but the real value at which PIA was sold was Rs10 billion because the bidder would be required to invest Rs125 billion in the airline.
PSO had approached the government, asking it to hand over the real estate asset of PIA in Islamabad to settle the receivables on account of jet fuel supply to the airline.
As receivables reached Rs30 billion, discussions were held between PSO and PIA on transferring the national carrier’s land to PSO to clear the dues. Despite the completion of the privatisation transaction, the piece of land has not been handed over.
A PSO spokesperson told The Express Tribune that no property had been handed over so far. “PSO continues to claim the entire receivable amount from PIA and will maintain this claim until the legal transfer of any agreed-upon assets is successfully completed.”
The spokesperson said that the total outstanding receivables from PIA currently stood at Rs30.15 billion, including the principal amount and the late payment surcharge.
PSO management, in a letter sent to Privatisation Commission Chairman and Adviser on Privatisation Muhammad Ali, drew his attention to the settlement of receivables and transferring PIA’s real estate in Islamabad in favour of PSO.
The company management recalled that PSO and PIA reconciled their accounts on March 21, 2024, whereby the total outstanding payables by PIA at the cut-off date of September 30, 2023 were calculated at Rs23.8 billion.
Subsequently, in light of the federal cabinet’s decision taken on February 5, 2024, PSO issued its consent letter dated March 22, 2024 with the understanding that the Islamabad real estate plot of PIA with an estimated value of Rs15 billion would be transferred in favour of PSO, subject to approval of the federal government.
It said that PSO and PIA had also reached an understanding that receivables amounting to Rs8.8 billion would be shifted to the books of PIA Holding Company.
“Since the privatisation process of PIACL has been completed on December 23, 2025, we request the privatisation ministry for the transfer of the aforementioned Islamabad real estate plot of PIACL in favour of PSO,” the company management said.
PSO has been struggling since the cabinet took the decision to settle the outstanding dues.
Though the PIA transaction has been concluded, PSO has not received the real estate asset.
Now, it has approached the Privatisation Commission chairman to settle the dues and in case of failure, industry officials say, PSO will be the first victim of the privatisation.
