China’s East Sea Group Limited has revealed plans to invest $4.5 billion to construct a refinery with a yearly oil processing capacity of 8 million tons in Gwadar, Pakistan.
Company CEO Fang Yulong, who is also Senior Vice President of the Pakistan-China Joint Chamber of Commerce and Industry (PCJCCI), revealed plans for the refinery in Gwadar during a briefing at the PCJCCI Secretariat.
He said, “We will build Gwadar Petroleum Storage and Transportation Trading Centre; this project will attract [the] world’s major oil trading companies to Gwadar Port”.
Fang stated that the setup would incorporate at least six crude oil ships for blending and trans-shipment at Gwadar Port, with a total capacity of 2 million tonnes per month. It will supply oil to major Middle Eastern oil-producing countries for sales and blending services.
He underscored that the growth of the energy industry was a critical catalyst for the progression of the South Asian nation’s economic structure. Fang explained, “It can not only stimulate and guarantee the development of various downstream industries but will also further reduce the trade deficit and increase foreign exchange reserves.”
The envoy articulated the significance of Gwadar’s strategic placement on the geo-political horizon as an important gateway for international trade. He said 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”.
The Gwadar Port’s strategic location near major oil-producing markets and trade routes, as well as its good political relations with oil-producing states, make it a potential energy and petrochemical trade hub.
Besides China, Pakistan is seeking a multi-billion-dollar deal with Saudi Arabia for an oil refinery project. Pakistan is close to striking a $12 billion deal with the Kingdom regarding the oil refinery project in the deepwater port of Gwadar. Saudi Arabia’s energy minister Khalid Al-Falih arrived in Pakistan over the weekend and has already visited the site of the proposed project.
The Government of Pakistan is yet to finalize a new refinery policy despite players like China and Saudi Arabia planning billion-dollar oil refinery projects in the country.
