OGRA consistently fails to settle forex losses adjustment OPMAP.

ISLAMABAD -- Oil Marketing Association of Pakistan (OPMAP) has said that Oil and Gas Regulatory Authority (OGRA) has consistently failed to settle foreign exchange losses adjustment and alleged that the regulator has allowed foreign exchange (FX) compensation to companies which did not even import any oil cargos.

In a letter to chairman OGRA, Oil Marketing Association of Pakistan has said that serious flaws were pointed out in the mechanism in FX compensation due to which the exchange losses due to industry have not been compensated. The reference is made to the meeting organized by OGRA held on 21st March 2023 to discuss the Mechanism of Exchange Rate Adjustment, the letter available with The Nation said. The agenda of the meeting was to discuss regarding unfair and unjustified working and distribution of FX losses. As you know, after the presentations, in the Q and A session, the industry pointed out very clearly that the entire industry barring PSO is facing existential crisis and this is mainly driven by the lack of a coherent policy by OGRA, OMAP alleged. It was specified that in a regulated environment, it was the duty of OGRA to ensure that the industry gets a level playing field and that the industry has been miserably failed by the regulator. OGRA has consistently failed to settle foreign exchange losses adjustment, negative IFEM, pricing, oil marketing companies margin revision, and other related issues. Your lack of action on these matters is causing great distress to emerging oil marketing companies which are struggling to compete with the established players in the market. Your deliberate negligence towards these demands has been deeply condemned by all oil marketing companies in a recent meeting, and it is clear that this issue needs to be addressed urgently.

The record is evident that OMAP is repeatedly knocking doors of OGRA and Petroleum Ministry to adopt an efficient mechanism for FX losses disbursement to ensure that each penny of national money goes to the true and eligible entities, without any pick and choose and ill-intended calculation to fetch fortune for non-entitled entities, the letter further said. Instead, the industry pointed out scenarios whereby OGRA formula has allowed FX compensation to companies which did not even import any cargos. All top companies including multinational players pointed out the serious flaws in the formula and demanded OGRA to fix the formula and ensure a level playing field for the...