Pakistan’s five oil refineries are expected to sign agreements in early September for upgrades that are expected to unlock as much as $6 billion in investment in the country’s refining sector.
Representatives of the five refineries, Pak Arab Refinery Limited (PARCO), Pakistan Refinery Limited (PRL), National Refinery Limited (NRL), Cnergyico, and Attock Refinery Limited (ARL), have met with Pakistan’s Federal Minister for Petroleum, Ali Pervaiz Malik, to discuss the so-called Refinery Upgradation Policy, local daily Business Recorder reported on Friday.
Executives at all five refineries said they were prepared to sign the upgrade program deals under the policy, according to a statement cited by Business Recorder.
The upgrades would help Pakistani refineries begin production of Euro-5 compliant fuels with ultra?low sulfur content, which are the norm in most Western countries and which will help Pakistan reduce its fuel imports, the minister said.
Modernizing Pakistan’s refining capacity is of crucial importance for the quality of domestic petroleum products, as well as for strengthening domestic supply resilience, reducing reliance on imported petrol and diesel, and advancing the country’s broader energy security objectives, Malik was further quoted as saying.
Since the Iran war crippled oil and fuel supply from the Middle East, Pakistan’s key energy supplier, the South Asian country has paid record premiums for fuel imports, scrambled to procure alternative crude oil supply, and paid the highest price for LNG cargoes since 2022, when spot prices in Asia spiked to record highs after the Russian invasion of Ukraine and the slashed pipeline gas supply from Russia to Europe.
Pakistan’s refiners have been inquiring with traders about potential crude oil supply from the U.S., Nigeria, and Central Asia, amid the crisis in the Middle East that threatens supply from both the Strait of Hormuz and the Red Sea.
Separately, Pakistan’s national Oil and Gas Development Company Limited (OGDC) this month signed an agreement with a Canadian firm to deploy advanced technology to boost production from heavy crude oilfields in a bid to raise domestic crude supply.
By Tsvetana Paraskova for Oilprice.com
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