The News reported that the government would release fourth tranche of at least PKR 2.5 billion from its bailout package of PKR 18.5 billion to Pakistan Steel Mills later this month though the steel maker failed to bring production at 20% level in July. PSM production dropped to 8% in July as its 18 out of 20 plants were closed.
Mr Muhammad Zubair chairman of Privatisation Commission said that “We are aware of the situation emerged due to water and electricity crises at Pakistan Steel Mills. The situation will not stop release of next tranche. The commission in April linked the release of tranches with the achievement of the set production targets: 20% in July and 10% in each subsequent month.”
An official of PSM said that the steel mills recorded only 8% production of the installed capacity in July. The water level was improving and management of PSM may consider resumption of one or more plants in a day or two.
He said that PSM is required to maintain at least 110 million gallons. Only 25 million to 26 million gallons water was available a day before yesterday, while PSM needs 15 million to 16 million gallons water per day to cool its production plants.
He added that since May to date, the ministry of finance has given PKR 9.57 billion in three tranches. The next tranche may be released on August 20 to 22 2014. The mills has used the received funds for importing raw material (coal and iron ore) and paying salaries, perks and utility bills.
Source – The News