Advancement in technology is the key in increasing output, and Pakistan Refinery Limited (KSE: PRL) has just turned up the notch. The refinery has completed the installation and has commissioned its isomerisation plant.
The new integrated isomerisation plant by PRL is the first in the refinery segment; the refining industry has been working on capital intensive upgradation of the plants to produce fuel that meet Euro-II emission standards and PRL is the first to complete one.
How does an isomerisation plant work? The chemical process converts low value Naphtha to premium product Petrol. Pakistan Refinery Limited has been exporting this low value product up till now and will now be able to increase its refining capacity by doubling its petrol production from 140,000 metric tons to 280,000 metric tons per annum, which translates into a monthly petrol output to approximately 24,000 metric tons from about 12,000 metric tons.
The plant has been completed ahead of its scheduled i.e. August 2015 by UOP/Honeywell, USA, which has been a market leader for isomerisation catalysts to the refining industry since 1958. Its EPA (engineering, procurement and construction) has been around 20 months compared to 30 months taken by similar plants on average. $50 million plant was built and imported from UAE to Pakistan for installation.
PRLs profitability has been in difficult times. The right-issue this fiscal year, along with the firms growth projects are the key in reducing the firms reliance on bank borrowing, finance cost smoother output. The production from its new modular isomerisation plant is expected to begin by the end soon and comes at a time when petrol consumption in the country is touching new highs. This is the first time any enhancement in petrol refining capacity has taken place; with around 14-15 percent share in countrys crude oil processing, PRL will not only improve its own output efficiency but also result in foreign exchange savings due to import substitution.
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