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 3. FINANCE  4. POLICY
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FINANCE

Mar 18 - 24, 2002

Oxy intends to invest $150m

John Winterman, executive vice president of Oxy Petroleum Company USA, has said that his company intends to make a further investment of $150 million in the petroleum sector of the country.

He expressed these views during a meeting with the Federal Minister for Petroleum and Natural Resources, Usman Aminuddin, on Thursday.

He also briefed the minister about the pace of work on the ongoing exploration and production activities in Pakistan being carried out by the company. He said that Oxy was looking forward to enter joint venture arrangement for possible exploration in the offshore area and expressed company's willingness to participate in the privatization activity in Pakistan.

Usman Aminuddin told Winterman that Pakistan was bestowed with rich hydrocarbons resources and invited the company to expand its activities in the upstream sector for which the government had already provided an attractive package of incentives under the Petroleum Policy, 2001.

The minister highlighted the government's efforts to open the areas for exploration in Balochistan which hopefully would bring about positive change. He also said that the emphasis of the government was to exploit all available gas resources so as to substitute imported fuel oil as much as possible thus easing the burden on national economy.

By June 2003, he added, an additional gas of one billion cubic feet per day would also be available in the country from the newly discovered fields. Usman applauded the historic contribution of Oxy Petroleum in the development of upstream sector in Pakistan during the last 20 years with investment of $800 million.

Fabric exporters profit plunges

Fabric exporters say the reduced unit price in the international markets and the abrupt appreciation in the value of the rupee against the dollar following the Sept 11 events has drastically eroded their profits in the second quarter of the current fiscal year.

Our viability has been hit very hard since the Sept 11 events although exports (of all types) of fabrics, including grey cloth, have gone up 9.7 per cent in terms of quantity in the first seven months of the current fiscal year (July-Jan) over the same period the previous year, leading fabric exporter Javed A. Siddiqui told on Saturday. On the other hand, the average unit price plunged by 9.4 per cent in the same period to $0.60 per square meter from the last year's $0.66.

In the first seven months of the current fiscal year, Pakistan exported 948 million square metre of fabric worth $568.100 million as against 864 million square metre for $567.446 million during the same period last year.

12 ICP funds offered for sale

The Privatization Commission revised on Thursday the number of Investment Corporation of Pakistan (ICP) Mutual Funds being offered for sale the management rights for 12 of ICP's funds as a single block rather than six.

The Privatization Commission issued a statement on Wednesday inviting bidders for the management rights for a block of six ICP Mutual Funds, but issued a "corrected" statement on Thursday advertizing the sale of management rights for 12 funds.

The statement said parties interested in buying the management rights of 12 of ICP's funds as a single purchase should express their interest by April 6.

Oil dealers' margin up

The government has approved increase in oil marketing companies' distribution margin from two per cent to 3.5 per cent and petroleum dealer's commission from three per cent to four per cent, it is learnt on authority.

SSGC to float Rs1bn TFCs

Sui Southern Gas Company Limited (SSGC) will launch Term Finance Certificates (TFCs) worth Rs1 billion in May this year to finance its gas infrastructure, rehabilitation and expansion projects.

A senior executive of the SSGC told that the issue of TFCs is expected to be launched in the first week of May. This would be the second issue of the TFCs of same worth, which launched in May 2001 by the company.

ADB plans to set up SME risk capital fund

The Asian Development Bank (ADB) is in the process of preparing a comprehensive development programme for Pakistan's small and medium enterprises (SMEs).

Under the programme, the ADB is likely to set up an SME risk capital fund. This was stated by the executive director, SME Institute of Finance, Washington D.C. David Lingelbach, at a meeting with FPCCI, chairman, Islamabad office, Sohail Altaf on Saturday.

Mr David said the prime objective of his current visit was to create awareness in and get input from the private sector to prepare a feasibility study to set up a fund in Pakistan.

Dollar up

The US dollar rose to Rs60.40/Rs60.50 for spot buying and selling in the kerb market on Thursday up 15 paisa from the previous close of Rs60.25/Rs60.35 as supply fell short from Dubai.

"The dollar supply from Dubai has fallen," said Ovais Kalia of Khanani & Kalia International who insisted to be identified as an analyst for KKI.

Shell Gas LPG

Shell Gas LPG (Pakistan) Limited the Liquefied Petroleum Gas (LPG) marketing company plunged into a loss of Rs18.1 million for the first half of the year to end-December 2001, from a profit of Rs11.4 million in the corresponding period of the previous year.

Top line growth remained impressive 29.7 per cent, with sales valued at Rs188 million for the latest half, against Rs144.6 million in the same period of 2000. But the gross profit dipped to Rs3.8 million, from Rs33.6 million and the margin stood almost completely wiped out at 2.1 per cent, from 23.4 per cent.