Govt to pursue major refinery projects with Saudi investors

KARACHI: Pakistan will advance two major projects in the refining sector during the Saudi delegation’s visit from October 9-11. State-owned Pakistan State Oil (PSO) and its subsidiary, Pakistan Refinery Limited (PRL), will engage with Saudi investors regarding the Greenfield Refinery and Brownfield Refinery projects to attract investment in these initiatives, sources disclosed.

Officials from PSO and PRL will be part of the government team that will hold talks with Saudi investors to seek investment in various sectors of the economy.Pakistan has been actively seeking investment in the Greenfield Refinery Project since approving a policy last year that includes significant incentives, such as a 7.5 per cent deemed duty for 25 years and a 20-year tax holiday. The country is looking for investments from Saudi Aramco and Chinese Sinopec for this project.

In July of this year, the PSO board approved up to $3 million for a market study to evaluate the feasibility of a $10 billion green refinery or crude-to-petrochemical complex. “The study has been awarded and is expected to be completed by December this year,” Taha Mirza, managing director of PSO, told The News on Monday.

Meanwhile, PRL is seeking investment for its Refinery Expansion and Upgrade Project (REUP), a major initiative aimed at doubling the refinery’s crude processing capacity from 50,000 barrels per day (bpd) to 100,000 bpd. This expansion will involve adopting a state-of-the-art deep conversion refinery configuration, with an estimated project cost of $1.7 billion.

During a recent visit to China, the Pakistani government delegation sought investment from the China Export & Credit Insurance Corporation, known as Sinosure, which expressed its willingness to finance $1 billion for the expansion project of Pakistan Refinery Limited (PRL).

“PRL will also seek Saudi investment in this project and will brief the Saudi investors about it,” officials at PRL told The News.

The country approved two policies last year related to the development of Greenfield refineries and the upgrading of existing refineries. However, substantial investment is required for both projects, and the government, along with the refining sector, has been working to attract this investment.