ISLAMABAD: in order to offer more incentives for oil refineries as part of the Finance Bill 2021-22, Minister for Energy Hammad Azhar has requested the Minister for Finance and Revenue Shaukat Tarin for a meeting to deliberate on the matter.
According to sources, following to a meeting of Hammad Azhar and Special Assistant to Prime Minister (SAPM) on Energy Tabish Gauhar with chief executive officers (CEOs) and managing directors of all five refineries, the Petroleum Division has called for a meeting.
As per details, the Petroleum Division, in consultation with refineries, has formulated an incentive package for investment in up-gradation and sustainable operation of existing refineries as well as to attract investment in new state of the art deep conversion integrated refineries.
It is pertinent to mention here that a draft incentive package was earlier prepared after extensive deliberation between the stakeholders, with the commitment of refineries for upgradation within five years to produce environmental friendly Euro-V spec products and reduce furnace oil production. After this duration, refineries will be in a position to operate at optimal capacity with technological enhancement, which will result in forex saving.
The Petroleum Division has formulated a draft policy titled ‘Pakistan Refining Policy’ for the survival and up-gradation of existing refineries as well as to improve end product specifications to Euro-V and attracting new state of the art deep conversion refineries. The said draft policy contains government’s fiscal support and tariff protection formula
Currently, Pakistan’s oil refining capacity is about 20 million tonnes per annum. About 60 per cent of the country’s requirements of diesel and 30pc of petrol are met by local refineries. The rest is imported as refined products.
Four out of five refineries operating in Pakistan are using mostly old technology and even the fifth one, PARCO, is now more than two decades old.