A shift is underway in Pakistan’s energy and power sector as Cnergyico, erstwhile known as Byco, is set to become the largest private sector fuel retailer in Pakistan. The change in market position for Cnergyico comes after it was announced that they were going to acquire a majority stake in Puma Energy Pakistan Private Limited (‘Puma).
After the acquisition, Cnergyico will become the second largest retail fuel network in Pakistan overall, behind only the state owned Pakistan State Oil (PSO). Based on the current numbers shared by OMCs in Pakistan, Cnergyico is overtaking Shell and Total to become the leading private sector fuel retailer in the country. The deal with Puma will add 542 fuel stations to Cnergyico’s holdings, taking its total to about 1,000 and making it the largest private fuel retailer in the country. State-owned Pakistan State Oil Co. has 3,500 retail stations, Total Parco Pakistan Ltd. has more than 800 outlets and Shell Pakistan Ltd. has 766 outlets.
Even before the acquisition that has significantly expanded the portfolio of the company, Cnergyico had one of the largest refining capacities in the country. They are the owners of Pakistan’s biggest oil refineries with an installed total capacity of 156,000 barrels per day located in Hub, Balochistan. Furthermore, the company owns a dedicated deep-sea oil terminal that is used to import oil for the refineries.
The move comes just over a month after Cnergyico officially changed their name from Byco. The announcement was made at the beginning of December 2021 because, in the words of their CEO Amir Abbassciy, “to mark our evolution from an oil company to a strategic oil refining and marketing company.” However, the name-change had also come only a few months after the federal government had very casually leveled serious allegations of creating artificial shortages, violating international sanctions, and defrauding the state-owned fuel retailer against Byco.
“The acquisition of the majority stake in Puma Energy demonstrates our continued interest to further strengthen and diversify our business,” said Mr. Amir Abbassciy, Chief Executive Officer – Cnergyico Pk Limited, “We have made a commitment to grow, modernize, and diversify our business and the takeover of Puma Energy will help support this strategic plan.”
Despite the name change and the few hitches along the way, Cnergyico seems to be going strong. Originally founded as an oil refinery company called Bosicor in 1995 by Parvez Abbasi, a former Caltex employee and veteran shipping & trade finance industry man, Cnergyico has undergone a lot of changes and challenges over the years. Construction of its refinery did not begin until 2001, and its refinery did not start production until 2004, when its refinery in Hub, Balochistan started production. The refinery started off with a capacity of handling just 8,000 barrels of crude oil per day but grew to a capacity of 30,000 barrels per day within its first year. In 2009, the company renamed itself Byco. It was not until 2007 that the then Byco launched its petrol retailing business, opening up its first petrol pump in Sukkur.
From that initial petrol pump, Cnergyico’s board of directors after approving the acquisition of 57.37% shares of Puma Energy have made sure that their network of petrol pumps has grown over 1000 and left behind its private sector competitors, Shell and Total. According to a report in Bloomberg, Cnergyico will continue to operate the two brands separately and will be the supply backbone of the second largest amassed retail network of fuel stations in Pakistan after PSO. The company also owns two storage terminals in Machike, Punjab and Daulatpur, Sindh that can together store up to 10,500 MT of petroleum products.
The opportunity to make the acquisition came because Puma Energy Holdings Pte, sold its stake in the Pakistan unit to joint venture partner Chishti Group last month. The struggling emerging-market fuel retailer and storage firm controlled by trading house Trafigura Group Pte, has been in talks to sell infrastructure assets in more than 30 locations, according to another Bloomberg report. The Swiss origins company which supplies and stores petroleum products, offers storage, transportation, logistics, and wholesale distribution of oil has been unprofitable for years following a debt-fueled acquisition spree. Trafigura, the trading house behind the company, raised its stake in April by agreeing to buy Sonangol’s entire interest in the business in a $600 million deal.
As Cnergyico goes forward, it will be interesting to see what they do with their newfound position as the largest private player in the market. As one of Pakistan’s leading energy firms, they will be looking to focus on productivity and profitability. They are already Pakistan’s largest oil refiner by design capacity, and is the nation’s only firm having a dedicated Single Point Mooring (SPM). Cnergyico’s SPM is the only floating liquid port in the country, and the company employs a round-the-clock crew dedicated for the safety and security of the buoy and vessels in and around the SPM’s anchorage area.
Cnergyico refines crude oil into various marketable components including Liquefied Petroleum Gas, Light Naphtha, Heavy Naphtha, High Octane Blending Component, Motor Gasoline, Kerosene, Jet Fuels, High Speed Diesel and Furnace Oil. The Company is proud to have the largest capacity crude oil storage tanks in the country. Cnergyico’s marketing network supports retail outlets in more than 80 cities all over Pakistan and is an emerging player in Pakistan’s oil marketing sector. They have approximately 900 dedicated employees across the firm’s divisions.