The Board of Directors of Pakistan Refinery Limited (PRL) has announced to undertake an expansion project worth $1.2 billion.
The company shared the development in its filing to the Pakistan Stock Exchange (PSX) on Tuesday.
The statement read that the BoD in their meeting held on December 27, 2021 decided to undertake Refinery Expansion and Upgrade Project (REUP) with the following objectives:
Compliance with requirement to produce EURO V compliant High-Speed Diesel (HSD) and Motor Spirit (MS/Petrol); Expansion of crude processing capacity to 100,000 barrels per day (bpd); And, to achieve self-sustainability by upgrading from Hydro-skimming Refinery to Deep Conversion Refinery thereby, significantly reducing production of High Sulphur Furnace Oil (HSFO).
The company added that the project cost is currently estimated at $1.2 billion on the basis of a detailed feasibility study. However, “actual costing will be determined after the completion of the FEED study, followed by financial close and award of Engineering Procurement & Construction (EPC) contract,” it added.
PRL would undertake the Front-End Engineering Design or FEED study of the said project and appoint the financial advisor, with the successful bidder expected to be in place by the quarter ending March 31, 2022.
Back in April, it was reported that PRL is looking to buy a second-hand refinery complex to upgrade its operations and increase output.
As per an advertisement placed by PRL in media back then, it was undertaking an upgrade and potential expansion project to produce Euro V specification and high-speed diesel oil. For this purpose, it intends to purchase a pre-owned refinery complex with one or more conversion units, which should have a 50,000 to 100,000 bpd throughput design.
Oil purchase makes up a major portion of Pakistan's import bill, which also jumped 64% year-on-year in the first four months of the current fiscal year — from July to October.