FIA Probes ₨10 Billion Petroleum Irregularities Case

The Federal Investigation Agency has initiated multiple inquiries into alleged irregularities relating to petroleum storage licences, fuel stock disclosures, and Price Differential Claims (PDCs) collectively exceeding ₨10 billion, according to a report published by The Express Tribune.

As per the report, the FIA Karachi Circle is conducting investigations in two separate matters involving officials associated with the Petroleum Division and the Department of Explosives.

In one inquiry, the conduct and role of the Director General Oil of the Petroleum Division is reportedly under examination. In a separate matter, former Director General Explosives Ali Khan is being investigated over allegations concerning unlawful issuance, renewal, and amendment of petroleum and chemical storage licences in Karachi.

The FIA has also questioned officials Muhammad Mubeen Ahmed, Deputy Director (BS-18), and Raj Kumar, Assistant Director (BS-17), regarding alleged violations of the Petroleum Rules, 1937 and other departmental regulatory requirements.

According to the agency, subsequent departmental findings identified several licence grants and renewals as irregular and potentially unlawful, making such licences liable to suspension or cancellation proceedings.

Separately, the FIA is also investigating allegations of petroleum stock misreporting and concealment by an oil marketing company alongside suspected regulatory lapses by the Oil and Gas Regulatory Authority.

According to the inquiry, inspections conducted at Karachi-based petroleum terminals reportedly identified discrepancies involving 6,891 metric tonnes of high-speed diesel stocks, 8,117 metric tonnes of premier motor gasoline inventories, and 5,010 metric tonnes of high octane blended component stocks compared to figures submitted to the Oil Companies Advisory Council.

The FIA described the discrepancies as “red flags” potentially indicating hoarding activities and concealment of fuel inventories through manipulation of stock data.

The report further alleged that officials of Ogra failed to initiate appropriate action despite being informed about the discrepancies and instead attempted to classify the irregularities as clerical mistakes.

The FIA additionally alleged that the concerned oil marketing company sold imported petroleum products before filing customs duty clearance documentation and prior to payment of applicable taxes and petroleum levy obligations.

According to the report, the inquiry also examined imported cargo consignments involving the vessels “PS Hamburg” and “Spruce 2”.

The agency further questioned Ogra’s verification mechanism for Price Differential Claims, alleging that PDC payments were processed primarily on the basis of auditor certifications submitted by companies without independent regulatory verification.

The report specifically referred to one PDC claim amounting to ₨2.98 billion and another valued at ₨7.1 billion.

According to the FIA, the findings emerged during eight days of investigation before further proceedings were suspended by the Sindh High Court following a petition filed by the concerned oil marketing company.

The report added that the Petroleum Division did not respond to requests seeking official comments on the matter.