A state-of-the-art oil refinery and petrochemical complex, being established at Gwadar deep seaport with around $11 billion Saudi investment, would open new energy vistas in Pakistan, improving the national economy and achieving autarky in the petroleum sector.
Minister for Petroleum Ghulam Sarwar Khan has signed Memoranda of Understanding (MoU) with his Saudi counterpart for setting up a $10 billion oil refinery, a $1 billion petrochemical complex, installation of two Re-gasified Liquefied Petroleum Gas (RLNG) plants with an estimated cost of $4 billion and another $2 billion investment in mineral development sector, an official source told APP.
“The petrochemical complex and refinery will help bring down the country’s oil import bill by $ 1.2 billion annually,” he said, adding that Pakistan’s annual oil consumption is around 26 million tons (MT), out of which 13.5 MT is met through local production of eight existing oil refineries. “While 50 percent of crude oil is imported to meet the energy needs.”
The official said the refinery would have the capacity to filter 200,000 to 300,000 barrels per day (bpd) of oil, while the petrochemical complex would develop POL by-product at Gwadar city, the ultimate destination of China Pakistan Economic Corridor (CPEC).
Answering a question, he said a mega oil city would be constructed on around 80,000 acres land with the purpose to refine and store imported oil for transportation to China using the CPEC route, besides developing a fuel supply chain for landlocked Central Asian states.
The fuel transportation to China via Pakistan would take just seven days, as importing through western China takes almost 40 days. “Currently, oil vessels take 40 days to reach China, while through Pakistan the oil supply will reach China within seven days,” he added.
Replying to a question, the official said the government is making all-out efforts to upgrade existing oil refineries and establish new deep conversion facilities to achieve self-sufficiency in this sector.
For this purpose, the government recently banned the import of furnace oil and announced unprecedented incentives package for setting up new deep conversion oil facilities.