|Date: May 24, 2017|
|PSO signs landmark fuel transportation agreement with Pakistan Railways|
|Karachi-May 24, 2017: Pakistan’s leading oil marketing company, Pakistan State Oil (PSO) has signed a landmark fuel transportation agreement with Pakistan Railways to enhance and expedite its supply chain operation in the country. PSO will transport around 2 Million metric tons of fuel per year via Railways in cost-effective and efficient manner as compared to road transportation.|
The agreement was signed by GM Logistics PSO, Mr. Syed Rashid Kamal and Additional GM Operations Pakistan Railways, Mr. Abdul Hameed Razi in the presence of the Minister Railways, Mr. Khawaja Saad Rafique, Secretary Petroleum & Natural Resources, Mr. Sikander Sultan Raja and various other senior executives from both the organizations. The agreement will be valid for a period of five years and is further extendable with mutual consent.
The rail transportation business has witnessed record aggregate growth of over 750% during last 5 Years. Rail share for transportation of fuels stands at a staggering 33 % in FY17 at rail head destinations as compared to just 4% in FY13.
The agreement will not only strengthen PSO’s supply chain operations but also bring substantial business opportunity to Pakistan Railways to make the organization profitable.
Moreover, they are hopeful that railway’s freight competitiveness will reduce overall IFEM cost which is part of the price structure of regulated products. The benefit will be directly passed on to the general public. The agreement will also enable transportation of bulk fuel oil volumes to power sector customers across the country which is not only economical but also addresses the environmental, security & safety issues which are associated with road transport.
Under the agreement, PSO and Railways will also explore the prospects of HSD movement to Sihala & Chakpirana sector and dry cargo movement through railways. The last fuel transport agreement between PSO and Pakistan Railways was signed in 1997 and subsequent efforts to sign a new agreement couldn’t see the light of day. However with the revival of railways and the sheer commitment and resolve from both organizations, agreement has finally been inked.
Expressing his views about the signing ceremony, MD Pakistan State Oil Sheikh Imran ul Haq said: “I congratulate both PSO and Pakistan Railways on signing the momentous cooperation agreement that will go a long way in bringing great deal of efficiency and productivity to our supply chain management and business to Pakistan Railways. We are increasing our dependency on railways for fuel transportation to make the fuel supply cost-effective and risk free. I am positive that the agreement will enable both the national organizations to enhance their role in the process of national development and contribution to the national exchequer. I look forward to working actively to materialize all the objectives set in the agreement.”