FIA registers eight inquiries against OMCs for 2020 petrol crisis

LAHORE: The Federal Investigation Agency (FIA), following the directives of the federal cabinet, has registered at least eight inquiries against the shortage of petroleum products, which led to a serious crisis in 2020, Bol News has learnt.

The federal cabinet had written a letter to director general FIA, ordering an investigation against Oil Marketing Companies (OMCs) which had allegedly caused Rs 25 billion loss to the national exchequer due to shortage of petroleum products in 2020.

DG FIA further referred the matter to Additional Director General FIA (North) Abu Bakar Khuda Bakhsh who has formed various teams to carry out the probe.

A senior FIA official, privy to the developments, told Bol News that following the cabinet’s ToRs, FIA has registered eight enquiries including (a) Failure to maintain minimum 20-days stocks as per the license requirement of OMCs over a prolonged period, (b) failure to ensure lifting of products by OMCs from local refineries as per PRM decisions of February, March and April, (c) failure to ensure implementation of PRM decisions regarding imports, (d) apparent maneuvering of berthing plan of vessels, (e) fake sales, hoarding and discrepancies between the reported and actual supplies to retail outlets by OMCs, (f) illegalities regarding provisional marketing licenses to OMCs, unlawful JVs and hospitalities, illegal private storages and illegal retail outlets, (g) inquiry into the affairs of BYCO refinery and OMC regarding MT Rhea, MT Elsa and reported involvement in sale of illegal petroleum products and (h) inquiry of companies involved in adulteration of petroleum products.

According to the FIA official, investigators have written letters to Oil and Gas Regulatory Authority (OGRA), Ministry of Energy Petroleum Division (MOEPD), Karachi Port Trust (KPT) and other related departments and sought official records relating to stock of petroleum products, their imports and the mechanism of fixing its prices.

The FIA official further shared that after analysing the official records, OMCs would be summoned for their response to finalise the probe.

The federal cabinet, chaired by Prime Minister Imran Khan, in April this year had referred the petroleum shortage matter to FIA. The cabinet had asked FIA to complete the forensic audit of the petroleum crisis within three months — the deadline for which expired in July but the investigations are still pending and more time has been sought to complete the task.

It may be mentioned that an inquiry commission was constituted in July 2020 to probe the shortage of petroleum products in the country which submitted its report to the federal cabinet.

The federal cabinet had constituted a committee comprising Minister for Planning Asad Omar, Education Minister Shafqat Mahmood, Human Rights Minister Dr Shireen Mazari, Railways Minister Azam Swati and Special Assistant to Prime Minister (SAPM) on Accountability Shahzad Akbar to analyse the report of the commission and suggest recommendations for administrative and policy actions in the light of the findings of the commission.

The ministerial committee had submitted its recommendations to the federal cabinet which approved them in January this year. Later on the matter was referred to FIA to unearth evidence against the criminal act.

Moreover, it was also pointed out in the cabinet’s letter that despite the existence of a 20-day backup stock rule in the law, OMCs had been violating this regulation since long.

According to the letter, OMCs had further failed to timely shift the stock from local refinery in February, March and April 2020. It further stated that in order to conceal the artificial sale and hoarding of petroleum products, fake reports were prepared by OMCs.

It was further stated in the cabinet’s letter that OMCs had established illegal private oil depots and retail outlets and requested an investigation into it. It also recommended to start a probe into the sale of prohibited petroleum products by OMCs.