No let-up in oil import burden despite Byco Refinery: POL demand may hit 25mmt by 2016

There will be no let-up in oil import burden despite Byco Refinery Project as the rising demand for POL products is expected to touch 25 million metric tons by 2016. "Despite Byco Refinery Project coming on stream, deficit imports would be more than 14 mmt by 2016," said Dr S N A Zaidi, General Manager Operations, Pakistan State Oil (PSO) in a presentation given at Pakistan Energy Conference on Monday.
Zaidi said the demand of petroleum products would increase from 21.3 Mmt in the current fiscal year to 23.1 mmt in FY12 while by 2016, POL demand is expected to touch 25 mmt. He added that with KPT OP-I planned maintenance in 2013, the port capacity would be reduced to 16 mmt for 2 years.
With crude, furnace oil (FO) and high speed diesel (HSD) import and export prospects (in view of new refinery), different options need to be explored including; SBM at HUB connecting the Bosicor refineries for crude imports; pipeline link between strategic ports for effective utilization of KPT oil piers and also as a contingency measure in case of port shutdown; and 2nd berth at Fotco to handle possible FO demand surge in view of gas supplies depletion.
Dr Zaidi said with increased product demand in future, there will be an imbalance in points-of-input and points-of-consumption. "70:30 is the FO demand in southern and central region (respectively)," he said. Zaidi said, "as Railways is a more efficient and cost effective mode of transport, the PR infrastructure needs to be reinforced through local and foreign equity. Initially, Pakistan Railway (PR) moved more than 2.5 million tons of petroleum products nationwide that has declined to 0.5 million last year. At present, more than 10,000 tank lorries are being used to transport petroleum products.
He said there is a serious need of strategic storage development to build up country reserves of crude and finished product. "The potential of Gwadar as a bunkering hub is huge due to proximity to Strait of Harms, the oil industry needs to develop oil depots at the point of consumption to cater for the demand," Zaidi added.