KARACHI - Pakistan State Oil (PSO) may face default on its payment obligation for LCs for oil purchase from international market, if the issue of circular debt of the company is not resolved in few days. The circular debt has now touched the highest mark in the history of the PSO, as it is now Rs95.529 billion and is increasing, as Rs2 billion is adding daily to this amount, the sources in the company told The Nation. On the other hand, according to the source, the company has the liabilities of Rs86.679 billion. This amount has been in the account of PSO because of the non-payments to PSO. PSO has to pay Rs22.874 million to PARCO, ARL has to receive Rs11, 831 million from the PSO, PRL has to get Rs9,704 million and NRL and Bosicar have to get Rs8.383 million and Rs 3,903mbillion from the PSO respectively. Rs446 million has to be paid by PSO to different other companies. Moreover, payment to KPS, which is due on 17th September 2009 amounts to Rs9, 901 million and the LC payment due up to 14th September 2009 is Rs19.637 million. The source added that Wapda has to pay Rs30.488 million to PSO, HUBCO has to pay Rs37.533 million. KAPCO and PIA has to pay Rs19.958 million and Rs2.356 million respectively, OGDC has to pay Rs358 million, Kohinoor Energy Rs573 million, AES Lalpir Rs8 billion and Saba Energy has to give Rs805 million to the PSO. The financial charges receivable from PIA now mounted up to Rs693 million and the audited price differential claim is Rs1.592 million. While Rs1.165 million has to be received by the PSO as price differential claim on imported PMG. He added that the non-payment for LC may affect the credit rating of Pakistan. It is alarming that despite several assurances from the government nothing has been done to remove the burden from the company. It is worth noting that Hina Rabbani Khar, former advisor to Prime Minister on finance had assured to clear the circular debt by July 2009. Finance Minister Shaukat Tarin gave surety for the payment of circular debt by 27th of August 2009, but now the date has been extended to 31st of August 2009. The government should now consider this situation seriously and should take concrete measures to resolve the issue. The circular debt had mounted, when the demand of furnace oil for power generation sector increased. Over the period of 2 years, the demand of FO and the amount of circular debt had touched the highest mark in the history. It is note worthy that the government has retired some amount of circular debt in March 2009 but it again rose up rapidly. If the payment for the oil consumed by energy sector is issued today, then what would be the picture of power sector in coming days when the consumption will hike further, as the government has allowed injection of rental power plants in this sector. We must keep in mind that not only these power generation plants will increase our oil import bill and it will also affect natural resources like natural gas, he added.