KARACHI: The Pakistan State Oil (PSO) has resumed fuel supply for 39 Pakistan International Airlines (PIA) aircraft after it received advance payment of Rs220 million ($789,804) from the airline, a PSO spokesperson confirmed on Saturday.
On Tuesday, the PIA announced it had canceled 14 international and domestic flights because of fuel shortages after the state-owned PSO canceled its supply over unpaid dues. The national carrier, slated for privatization by the government, has amassed substantial losses and unpaid dues amounting to hundreds of billions of rupees.
The airline’s request for Rs 23 billion ($76 million) in operational support was declined by the government, prompting Prime Minister Anwaar-ul-Haq Kakar to initiate a restructuring plan to stabilize the airline’s finances.
“PKR 220 million have been received [from the PIA] for Saturday and Sunday’s refueling,” Naila Erum, a PSO spokesperson, told Arab News over a text message. “Thirty-nine flights’ list [has been] given for 21.10.23.”
The PIA’s spokesperson did not respond to queries by Arab News till this report was filed.
Besides other financial needs for repairing parts and maintaining aircraft, the airline needs Rs100 million a day to pay for fuel from PSO, which canceled supply this week over Rs1.4 billion in unpaid dues.
Pakistan agreed to fiscal discipline plans as part of a $3 billion arrangement with the IMF, including the privatization of loss-making assets.
As of October 16, 2023, the outstanding amount owed by PIA to PSO stood at Rs 26.825 billion, Erum told Arab News earlier this week. This comprises Rs 14.893 billion as the principal amount and Rs 11.932 billion as Late Payment Surcharges (LPS).
“The payable amount against current supplies as of October 17 was Rs 2,072 million,” she said.
PIA spokesperson Abdullah Khan confirmed on Tuesday that PSO had discontinued fuel supply to the national airline due to payment issues.
“The government has opted to privatize the airline, discontinuing interim support in the meantime to sustain the airline’s operations,” Khan said.
PIA is grappling with a fuel crisis as it aims to resume flights to the United Kingdom within the next two months.
Flights to Europe and the UK have been grounded since 2020, following the European Union’s Aviation Safety Agency’s revocation of the airline’s authorization to fly to the bloc due to a pilot license scandal.
