Fate of green refinery: PSO shares market study with Aramco, Sinopec

ISLAMABAD: Pakistan State Oil (PSO) has shared the market study with Sinopec, a Chinese company, and Saudi Aramco enabling them to decide for establishing a $10 billion green refinery or a crude-to-petrochemical refinery.

The market study was carried out on the suggestion made by Sinopec and Saudi Aramco to know if the refinery is required or not. PSO was given the task to complete the study by end of December, 2024.

“As per the study, the peak demand for POL products at a global level would be in 2028-29 then decline would start,” a senior official at Petroleum Division told this scribe. However, in case of Pakistan, demand for POL products would stay till 2050.

As far as petrochemicals are concerned, PSO study says demand for petrochemicals in Pakistan is not up to the mark. The petrochemicals could be exported, the official said. The ball is now in the court of Sinopec and Saudi Aramco to decide if they would establish a refinery at Hub, Balochistan, or not, the official said.

“Pakistan wants Saudi Arabia to establish a deep conversion state-of-the-art refinery in Pakistan for which it notified the green refinery policy in 2023, loaded with huge incentives including 7.5pc deemed duty for 25 years and a tax holiday for 20 years,” the official said.

However, top official sources, while referring to the study, said Saudi Aramco and Sinopec may not agree to install the refinery, as in the years to come dependence on fossil fuel will diminish and use of alternate fuel and electric vehicles will increase manifold.