Chinese firm mulls $4.5bn investment in refinery project

LAHORE: Chinese company East Sea Group Limited has planned to invest $4.5 billion to build a refinery plant with an annual refining capacity of 8 million tonnes at Gwadar, its CEO Fang Yulong said in a think tank session of Pakistan China Joint Chamber of Commerce and Industry (PCJCCI) on Thursday.

“We will build an international Gwadar petroleum storage and transportation trading center. The project will attract the world’s major oil trading companies and oil companies to Pakistan Gwadar Port,” Yulong, who is also senior vice president of PCJCCI, stated.

He added that the company would place at least 6 ships of crude oil for blending and transshipment operations with a total of 2 million tonnes per month at the Gwadar port.

“It will provide oil to major oil-producing countries in the Middle East of oil transfer, STS [ship to ship transfer] and blending services.”

Yulong stressed that the development of energy industry was an important catalyst for transformation of Pakistan’s economic structure.

He was of the view that it would not only stimulate and guarantee industrial development of various downstream industries, but also further reduce trade deficit and increase foreign exchange income reserves in Pakistan.

“Gwadar is the throat of several important maritime routes from Africa, Europe, the Red Sea, the Strait of Hormuz, and the Persian Gulf to East Asia and the Pacific. Its strategic location close to major oil-producing countries and shipping routes and good political relations with oil-producing countries make Gwadar a potential energy and petrochemical trade center.”

The establishment of an international Gwadar petroleum storage and transportation trading center would bring powerful support conditions to ensure diversity, convenience and safety of Pakistan’s energy supply, he stated, adding that it would not only further enhance the country’s international influence, but also support sustainable development of the national economy.

PCJCCI svp remarked that his company had great shipping capabilities and rich experience in oil products blending, transshipment and barge operation.

Gwadar’s excellent deep-water port and favorable geographical location, as well as Pakistan’s good and close government relations with surrounding oil-producing countries will add value to the project, according to Yulong.