KARACHI: Pakistan Refinery Ltd notified the stock exchange on Wednesday that due to heavy rains in Karachi on Aug 25, the water washed away a portion of the Piles Bridge carrying the intracity oil pipelines which connect Keamari Terminal to the Refinery at Korangi Creek for transportation of crude oil and products.

“The incident resulted in severely damaging the aforesaid oil pipelines,” the company observed. It added that access to the site was difficult but the situation was being assessed so the magnitude of damage could be ascertained “enabling us to take required measures regarding safety and continuity of refinery operation in the present situation, which may include [their] temporary shutdown.”

After completion of assessment, PRL said it would be able to estimate the time period for restoring the oil pipelines and the same would be communicated to the exchange.

The refinery usually keeps 7-12 days of stock according to management sources, and product can move via tanker from the refinery gate.

Keeping the refinery operational for a few more days is possible, but if the situation drags out longer then halting production may become necessary, according to some sources in the management.

The refinery has three pipelines that connect it to terminals and a berth in Keamari. One pipeline carries crude from the port to the refinery in Korangi. Another carries white oil (diesel and petrol) to terminals in Keamari belonging to the oil marketing companies, and the third is the furnace oil pipeline which also has its terminus in Keamari. All of these were built in the early 1960s.

“Once rains stop in the catchment area of Malir nadi then the waters will recede,” a source tells Dawn. A full damage assessment cannot be completed until then.

PRL on Aug 20 reported a loss of Rs7.59 billion for the year ended June 30, translating into a loss per share at Rs17.74, worsening by 30.4pc from loss of Rs5.82bn and LPS Rs13.68 in FY19.

The board did not declare a dividend. Revenue from contracts with customers plunged by 21.8pc to Rs90.5bn, from Rs115.7bn resulting in gross loss of Rs4.37bn, up from Rs3.17bn.

Along with the figures, PRL provided “Extracts from the Notes to the financial statements for the year ended June 30” which referred to the basis of preparation of the accounts. It stated that as of June 30, the company had accumulated losses of Rs18.36bn and the current liabilities exceeded current assets by Rs16.84bn.

PRL ended the year with net negative cash and cash equivalents amounting to Rs10.19bn. The board of directors said that in order to address the negative equity and liquidity issues, the company had made a right issue of one share for every one share held amounting to Rs3.15bn, which was fully subscribed.

On Wednesday, the stock in PRL was the highest traded scrip among the top ten volume leaders at the market; it recorded turnover of 49m shares. The share closed at the price of Rs18.34.

Published in Dawn, August 27th, 2020