Staff Report
ISLAMABAD:
Oil and Gas Development Company Limited (OGDCL) has received its first interest payment of Rs7.725 billion from Power Holding (Private) Limited (PHL), marking a key milestone in the government’s ongoing circular debt settlement initiative for the energy sector.
The payment, confirmed in a regulatory disclosure to the Pakistan Stock Exchange (PSX) and London Stock Exchange (LSE) dated August 4, 2025, was made under the government-approved circular debt resolution mechanism, which involves the issuance of Term Finance Certificates (TFCs) by PHL.
According to OGDCL’s earlier disclosure dated June 27, 2024, a total interest amount of Rs92 billion is to be repaid to the company in twelve equal monthly installments, starting from July 2025. The first installment of Rs7.725 billion now reflects concrete progress in addressing the energy sector’s liquidity challenges.
OGDCL communicated the development to the PSX in accordance with Section 96 of the Securities Act, 2015, and Clause 5.6.1(a) of the PSX Regulations, ensuring the timely dissemination of material information to market stakeholders. The Securities and Exchange Commission of Pakistan (SECP) has also been notified of the transaction.
This payment represents a critical step in the broader reform strategy aimed at resolving Pakistan’s longstanding circular debt, which has constrained the financial viability of energy supply chain companies and undermined investor confidence.
Industry analysts view the payment as a signal of the government’s commitment to honor financial obligations under the circular debt settlement plan and maintain stability within the upstream petroleum sector.
