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Thu, Jun 15, 2023 1:15 PM

British Oil Giant Shell Dumps Pakistan After Suffering Massive Losses In 2022

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British Oil Giant Shell Dumps Pakistan After Suffering Massive Losses In 2022
Shell Pakistan (SPL) announced Wednesday that its parent company, Shell Petroleu...

Shell Pakistan (SPL) announced Wednesday that its parent company, Shell Petroleum Company, would be exiting the South Asian nation after 75 years

It would sell its 77 per cent shareholding in the local business, which suffered massive losses in 2022 due to devaluation in the Pakistani rupee, exchange rates, overdue receivables and the ongoing economic crisis in Pakistan, Reuters reported

A spokesperson for Shell Pakistan said in a statement, “To support its intention to high-grade and simplify its portfolio, Shell Petroleum Company Ltd … has initiated a sales process to sell its 77.42 per cent shareholding in Shell Pakistan Ltd.” That includes “all of SPL’s Downstream businesses and SPL’s 26 per cent ownership of Pak-Arab Pipeline Company Ltd (PAPCO),” the spokesperson added

SPL to continue to list on Pakistan Stock ExchangeSPL, which is listed on the Pakistan Stock Exchange, clarified that the operations of the company will continue, and Shell’s exit will not have any impact on the company’s listing

In a notice sent to the exchange, SPL wrote that Shell informed its board of directors about its intentions of selling the holdings in a meeting on June 14

“Shell has entered into a process and wants to be transparent,” the spokesperson said

Shell’s move triggers political row in PakistanAfter Shell’s announcement to withdraw from Pakistan, Farrukh Habib, the former Minister of State for Information and president of PTI West Punjab, criticised the government led by Shehbaz Sharif, labelling it as a ‘fascist regime’

Habib wrote in his tweet, “Multinationals are on way out from Pakistan, now Shell has decided to sell its shareholding from Pakistan

The reasons include a highly uncertain political environment, regulated markets, capital controls, import restrictions, policy inconsistency, and higher taxes

Big multinational companies like Shell divestment, who have catered to Pakistan for more than 50 years will give a very bad signal and completely no confidence in Shehbaz Sharif Fascist regime.” The news of Shell’s departure also elicited disappointment from Pakistani internet users

One Twitter user expressed that this development is only the beginning of a much larger problem

The user’s comment came in response to a tweet by Pakistan Tehreek-e-Insaf regarding Shell’s exit

Many individuals blamed the Pakistan Army, Prime Minister Shehbaz Sharif, and Finance Minister Ishaq Dar for the poor economic conditions that ultimately led to Shell’s departure from the country after a presence of 75 years.

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