Six new refineries in Pakistan to boost oil production

ISLAMABAD: At least six oil refineries are at different stages of completion to ramp up crude oil refining capacity in Pakistan by around five per cent with the government offering ‘unprecedented’ incentives to downstream sector to meet growing energy demand, officials said on Tuesday.

A senior official told APP that, currently as many as six projects, investment initiatives, and proposals in oil refining sector are in pipeline and at different stages to purify crude of around 1.110 million barrels per day (BPD).

“Cognizant of the ever-growing energy requirements of the country, the government is working on a multi-faceted strategy to accelerate oil and gas exploration activities in potential areas, besides achieving self-sufficiency in crude oil refining sector,” the official, privy to the petroleum sector development, said.

Officials said the government is making all-out efforts to upgrade existing oil refineries and establish new deep conversion facilities for meeting the country’s fuel requirements in a smooth manner.

“Unprecedented incentives package is in place for setting up new deep conservation oil refineries, enabling them to import machinery, vehicles, plants and equipment and other materials.”

Sharing details, the official further said under the strategy an oil refinery and petrochemical complex of 300,000 barrels per day (BPD) of oil capacity would be set up in Gwadar. Pak Arab Refinery (Parco) will set up a coastal refinery with 250,000 BPD in Hub.

Sino Infrastructure Hong Kong Oriental Times Corporation will establish Gwadar Refining and Industrial Park and upcountry deep conversion refinery of 250,000 BPD. Pakistan State Oil and Power China International Group will install a crude pipeline of 250,000 to 300,000 BPD.

Falcon Oil Private Limited will set up an oil refining facility with 40,000 BPD in Dera Ismail Khan. Khyber Refinery Limited will establish a facility to refine 20,000 BPD of oil in Kohat.

The official said the country’s domestic production of crude oil witnessed around 12. 8 per cent growth for nine months (July-March) of the last fiscal year. Local production of crude oil remained 24.6 million barrels during the period under review as compared to 21.8 million barrels in the same period of 2017/18.

Crude import, during the period, stood at 6.6 million tons worth $3.4 billion compared to 7.8 million tons of $2.9 billion a year ago. The Oil and Gas Regulatory Authority (Ogra) said imports meet most of the demand of motor spirit (MS), high-speed diesel and furnace oil (FO), “as domestic production was not enough to meet the country’s requirement”.

“Around 71 per cent of MS, 42 per cent of high-speed diesel and 56 per cent of demand was met through import of finished POL (petroleum, oil and lubricant) products,” Ogra said in a report for 2017/18.

In FY2018, production of refineries grew 13 per cent as compared to the preceding year. Production remained at 13.63 million tons (energy and non-energy products) in FY2018 as compared to 12.07 million tons in 2016/17.

Byco’s production showed significant growth of 113.5 per cent due to operation of second oil refinery. Parco had the major share in total production at 33 per cent followed by Byco with 19 per cent and National Refinery Limited 17 per cent.

The official said eight oil refineries are currently operating in the country: Pakistan Refinery, National Refinery, Parco, Attock Refinery, Byco-I and II, Enar Petroleum Refining Facility (ENAR¬I) and Enar Petroleum Refining Facility (ENAR-II).