Pakistan convinces Saudi Arabia to set up $12bn refinery, petrochemical complex

[ziaulislam]

View attachment 888909

• Saudi Arabia to establish state-of-the-art refinery in Hub.
• Project revived due to efforts of Shehbaz Sharif government.
• Saudi Crown Prince expected to visit Pakistan in November.

ISLAMABAD: The Shehbaz Sharif government has succeeded in persuading Saudi Arabia to revive a major project shelved during the PTI government and establish a state-of-the-art deep conversion refinery along with a petrochemical complex in Pakistan, a top official at the Energy Ministry told The News.

The official confided to the publication that a high-powered delegation of the kingdom, headed by Crown Prince Mohammad Bin Salman, is coming to Pakistan in the last week of November during which a formal announcement is expected in this regard.

The Pakistani side, according to the report, made huge efforts to persuade the kingdom to honour the MoUs and invest in Pakistan. Islamabad also put its weight behind Riyadh, which has locked horns with Washington over the cut in oil supply in the international market.

In February 2019, during the visit of Mohammad Bin Salman to Pakistan, Saudi Arabia signed MoUs for an investment of $21 billion in various sectors of the economy, including for the project of a deep conversion refinery and petrochemical complex with an investment of $12 billion.

The Saudi oil giant Aramco also conducted a study in this regard which found that setting up a refinery in Gwadar was not feasible. However, it can be established at Hub, Balochistan, or near Karachi, the official said.

Later, when the ties of Imran Khan's government got strained with Saudi Arabia, the top decision-makers of the kingdom virtually put MoUs of $21 billion on the backburner signed in February 2019, the official said.

Now in the latest scenario, the official said, the Ministry of Petroleum is working on an upgrade of the draft for the refining policy to allure investment for setting up new refineries. The government is making up its mind to offer the investors profitability at 14-15% against the offer of 9%, earlier offered in the draft for refining policy prepared by the PTI government, apart from increasing the tax holiday’s scope.

The government also wants investment from China for a refinery and to this effect, Prime Minister Shehbaz Sharif, during his upcoming visit to China, will offer Beijing to set up a refinery in Pakistan.

“Top mandarins of the Petroleum Division with input from existing refineries are very much busy upgrading the refining policy draft.” And to this effect, more meetings would be held with stakeholders. One of the top men of the sitting government is spearheading the drive to upgrade the refining policy draft to ensure the setting up of a new refinery of 300,000-400,000 barrels per day by Saudi Aramco.

The official said that the new refinery will be able to export 35-40% of POL finished product and the rest will be used to cater to the country’s needs.

The government is also working on setting up another state-of-the-art and deep conversion Parco Coastal Refinery (PCR) for $5-6 billion with a capacity to refine 250,000 million barrels per day (BPD) crude oil at Hub, Balochistan.

The Government of Pakistan, the official said, will have 60% shares and Abu Dhabi’s International Petroleum Investment Company (IPIC) 30% and OMV 10%.

Pakistan wants to offload some of its shares to China in PARCO Coastal Refinery at Hub.

The prime minister, during his visit to Beijing, will offer China to become a stakeholder in PARCO-2 and also invite Beijing to install a refinery in Gwadar based on the new refining policy.

Pakistan convinces Saudi Arabia to set up $12bn refinery, petrochemical complex

Saudi Arabia to establish state-of-the-art refinery in Hub.Project revived due to efforts of Shehbaz Sharif government.Saudi Crown Prince expected to visit Pakistan in November.ISLAMABAD: The...

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Oh God..no..oh God

Please don't offer anything outrageous

We already stuck with 25% ROI on gas and coal giving a rate twice that of India ..


Coal is outrageous 8 cents and hydro at 10 cents vs world average of 3-4 cents and 5 cents(like for 80% WB funded projects)

 

[PakFactor]

Oh the same oil refinery that we have hearing about the for last 2 decades.

Lol, exactly. This garage has been recycled to death.

 

[MultaniGuy]

To be fair. There are always two countries that always helped Pakistan. Saudi Arabia and China.

 

[chinasun]

Governing the country requires scientific and rational development planning. What are the specific development plans of Pakistan's new government in the future? What is the focus of the government's work?

 

[Baba_Yaga]

All their money is going to that contration that they are building in the middle of the desert, they even promised like 100 billion investment in india, i doubt even 1 billion has been made. Even Prince Salman is a type of Feku, thats why they both get along so well.

 

[SoulSpokesman]

@Baba_Yaga

Saudis have invested a couple of billion dollars in Jio. Alfanar is investing in RE in a big way.

Aramco had looked at a very large investment in RIL which was first nixed by GoI for unknown reasons; later the deal fell out because of valuation. Now they are looking at a large shore based greenfield refinery in partnership with Indian PSUs.

Regards

 

[SD 10]

@Bilal.

Bilal bhai

what you explained is a sustainable commercial operating model. What the article describes is a guaranteed return of 14-15%.

Then I must say it is not a sound decision at all.

The only justification for such a deal then can be that Pak is desperate for investments and at the moment it has no choice but to offer a fixed return. But not advisable.

Regards

pmln has done it countless times, they make promises on pakistan`s behalf which simply cant be fulfilled! But this refinery saga, i have been hearing it for the past 15 years.... just a lollipop so that pmln can get some headlines in the newspaper!

 

[SoulSpokesman]

@SD 10

As long as the only downside is empty promises and headlines, it is fine. Hopefully there are no onerous liabilities arising out of it!

Regards

 

[ghazi52]

The same hue and cry were there in 2019 . when KSA promised to make an FDI in Oil Refinery in Pakistan!
Have the KSA fulfilled their 1st Promisss?
Foolish to believe them the 2nd Time!

 

[Baba_Yaga]

@Baba_Yaga

Saudis have invested a couple of billion dollars in Jio. Alfanar is investing in RE in a big way.

Aramco had looked at a very large investment in RIL which was first nixed by GoI for unknown reasons; later the deal fell out because of valuation. Now they are looking at a large shore based greenfield refinery in partnership with Indian PSUs.

Regards

bhai ye regards kya laga rakha hai? This is not linkedin Anyway, big difference between couple of billion and promised 100 billion.

 

[nahtanbob]

Governing the country requires scientific and rational development planning. What are the specific development plans of Pakistan's new government in the future? What is the focus of the government's work?

scientific ?? rational ?? Did you come to the wrong house ??

The same hue and cry were there in 2019 . when KSA promised to make an FDI in Oil Refinery in Pakistan!
Have the KSA fulfilled their 1st Promisss?
Foolish to believe them the 2nd Time!

Before you believe the Saudis why would anyone invest in a $12 billion oil refinery in Pakistan ? Ask yourself the question rationally

 

[Goritoes]

Har 6 maheenay baad Saudi yeh lollipop day dete hain.

2 saal mai statements ke 6 Refinery's laga di hai.