Govt to Revisit 30-Year Lease Extension for Engro Vopak Terminal

The Economic Coordination Committee (ECC) is set to revisit its decision to grant a 30-year lease extension to Engro Vopak Terminal Limited (EVTL) after Investment Minister Qaiser Sheikh raised objections, arguing that the move violates public procurement rules and could hurt competition in the petrochemical sector.

The matter has been referred back to the ECC by the federal cabinet following the minister’s protest against the decision. Speaking to *The Express Tribune*, Sheikh said he had formally written to Finance Minister Muhammad Aurangzeb, who chairs the ECC, and the issue would be taken up again at Tuesday’s meeting.

The controversy comes just days before the expiry of EVTL’s existing 30 year lease agreement with the Port Qasim Authority (PQA), which was signed in 1996 under a build operate transfer arrangement. Earlier this month, the ECC approved a further 30 year extension as part of an additional agenda item submitted by the Ministry of Maritime Affairs.

In his correspondence, Sheikh said his objections were not reflected in the official ECC meeting minutes. He argued that EVTL’s unsolicited proposal did not meet the requirements of Public Procurement Regulatory Authority rules relating to unique and innovative projects and therefore did not qualify for an extension without competitive bidding.

The minister further stated that granting another 30 year term without an open bidding process could create a monopoly and negatively affect the development of Pakistan’s petrochemical industry. He maintained that both PPRA rules and a PQA in house assessment committee had concluded that the company’s proposal did not meet the criteria for exemption from competitive bidding.

According to official records, the PQA board had previously resolved in 2021 that negotiations on a lease extension had failed and directed the authority to initiate a competitive bidding process. In 2022, EVTL submitted an unsolicited proposal, but a PQA committee reportedly concluded that it was neither unique nor innovative enough to qualify under the relevant procurement rules.

Despite that assessment, negotiations were later reopened and amendments were made to the implementation agreements. Eventually, the PQA board approved a proposal to extend the lease for another 30 years under revised terms, a decision subsequently endorsed by the ECC.

EVTL operates one of Pakistan’s most strategically important energy and chemical terminals, handling more than 60 percent of the country’s bulk chemical imports and around 55 percent of marine liquefied petroleum gas imports. Supporters of the extension argue that the terminal has played a key role in facilitating downstream petrochemical investment and reducing costs for the economy.