Delay hits $3.2b Saudi oil facility for Pakistan

Pakistan faces a delay in heading ahead with a bailout package of $3.2 billion due to a deferred oil and gas payment facility provided by Saudi Arabia as the latter wants the deal individually terms.

The 2 countries had inked a funding agreement for the import of petroleum products, crude oil and LNG on February 17 this year at the time of the Saudi crown prince’s Islamabad visit.

Now, the petroleum division has tabled an overview before the Economic Coordination Committee (ECC) on an urgent basis requesting it to relax rules so the deferred payment facility could be availed to ease pressure on the country’s foreign exchange.

he HDIP laboratory tests items at the discharge port prior to unloading. However, while agreeing on the terms and conditions of the sales purchase agreement with the PSO, Saudi Aramco has insisted that the procurement should be depending on the cost, insurance, and freight (CFR/CIF) terms in line with the International Chamber of Commerce’s Incoterms 2000. Under these terms, the quality would be determined and finalized at the load port depending on the test results of an independent laboratory.

If Pakistan allows this condition, the existing steps involved in sampling and testing of imported petroleum products by Ogra would have to be relaxed regarding supplies organized by the PSO from Saudi Arabia.

Consequently, the petroleum division is looking to get a waiver from the ECC to secure the deferred payment facility.

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