ISLAMABAD: The Shahbaz Sharif government has managed to convince Saudi Arabia to revive a major project stalled during the PTI regime and set up a state-of-the-art deep conversion refinery with a petrochemical complex in Pakistan, the Energy Ministry said. A high official told JEE News.
The official told the publication that a high-level delegation of the kingdom, headed by Saudi Crown Prince Mohammed bin Salman, is coming to Pakistan in the last week of November, during which an official announcement in this regard is expected.
According to the report, the Pakistani side made great efforts to persuade the kingdom to respect the MoUs and invest in Pakistan. Islamabad has also thrown its weight behind Riyadh, which has locked horns with Washington over cuts in oil supplies to the international market.
In February 2019, during Mohammed bin Salman’s visit to Pakistan, Saudi Arabia signed memorandums of understanding to invest $21 billion in various sectors of the economy, including $12 billion in deep conversion refineries and petro. A plan for a chemical complex is also included.
Saudi oil company Aramco also conducted a study in this regard, in which it was found that it is not possible to establish a refinery in Gwadar. However, it could be set up near the hub, Balochistan, or Karachi, the official said.
Later, as Imran Khan’s government’s relationship with Saudi Arabia soured, the kingdom’s top decision-makers virtually shelved the $21 billion memorandum of understanding signed in February 2019.
Now in the latest scenario, the official said, the petroleum ministry is working on upgrading the draft refining policy to attract investment for setting up new refineries. The government is mulling to offer investors a return of 14-15 per cent, compared to the 9 per cent offer, before extending the scope of tax holidays in the draft refining policy prepared by the PTI government. was also offered.
The government also wants investment from China for the refinery and in this regard Prime Minister Shahbaz Sharif will offer Beijing to set up a refinery in Pakistan during his upcoming visit to China.
“Higher Mandarin of Petroleum Division is very busy upgrading the draft Refining Policy with input from existing refineries.” And more meetings will be held with stakeholders in this regard. One of the top figures in the current government is leading a campaign to upgrade the draft refining policy to ensure the establishment of a new 300,000-400,000 barrel-per-day refinery by Saudi Aramco.
The official said the new refinery would be able to export 35-40 percent of POL’s finished products and the rest would be used to meet the country’s needs.
The government is also working on setting up another state-of-the-art and intensive $5-6 billion Parco Coastal Refinery (PCR) with a capacity to refine 250,000 million barrels per day (BPD) of crude oil at the Hub, Balochistan.
The official said the government of Pakistan will hold 60 percent shares, while Abu Dhabi’s International Petroleum Investment Company (IPIC) will hold 30 percent and OMV 10 percent.
Pakistan wants to offload some of its stake in the Parco Coastal refinery in the hub to China.
During his visit to Beijing, the Prime Minister will offer China to become a partner in PARCO-2 and also invite Beijing to set up a refinery in Gwadar based on the new refining policy.
