ISLAMABAD: Prime Minister Shehbaz Sharif has directed Petroleum Division to arrange signing ceremony of refinery upgrade agreements under Brownfield Refinery Policy to be witnessed by him, well informed sources in Petroleum Division told Business Recorder.
These directions were issued at a recent meeting on energy sector, presided over by the Prime Minister. Petroleum Division has started discussions with the refineries for the ceremony.
On February 24, 2024, Ministry of Energy (Petroleum Division) notified the amended oil refining policy after its approval by the Cabinet on February 15, 2024, as recommended by the Cabinet Committee on Energy (CCoE) in its meeting of February 6, 2024.
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The policy, originally notified on August 17, 2023, has now been amended after taking into consideration the genuine concerns of the refineries on some of the clauses that would have made the proposed upgradation projects unviable.
The amendments were made after intense and prolonged consultation between the government, refineries, and independent financial and legal advisory firms.
The policy will enable the oil refineries to undertake major upgradation projects to not only to comply with Euro-V specifications but also increase production of deficit products of petrol and diesel by 99 per cent and 47 per cent, respectively and also reduce production of furnace oil by 78 per cent, which because of drastically reduced demand in recent years often results in storage constraints forcing the refineries to reduce capacity utilisation.
The refineries’ upgradation will bring in an investment of US $5-6 billion and not only result in cleaner environment-friendly fuels but also major savings of precious foreign exchange.
He further said that the refineries’ upgradation policy would be termed as the most important achievement of the caretaker government and it is hoped that it would be implemented in its true letter and spirit.
The policy, took more than four years in the making mainly due to changes in governments and the bureaucracy, was initiated by Nadeem Babar as Special Advisor to the then Prime Minister.
The Chairman of OCAC, Adil Khattak, pointed out that the OGRA and the Directorate General Oil’s role have been pivotal in formulation of the policy and will remain so in successful implementation of the policy.
Copyright Business Recorder, 2024