Why Cnergyico the conglomerate makes more sense than Cnergyico the oil company

Something is brewing over at Cnergyico. The petroleum company is in the doldrums. Over the past five years their production as an oil refiner has gone from an impressive 20 million tons (MT) to a shadow of its former self at 6.8MT this year. Similarly its market share has fallen from 22% in 2018 to barely 10% in 2022. 

And these are merely the symptoms. 

For the past few years Cnergyico has been sick. The ailing organ has been the company’s heart — its massive oil refinery in Hub Balochistan which, at the capacity of 156,000 barrels a day (bpd), is the largest refinery in Pakistan. This refinery is everything to Cnergyico. It is the company’s largest asset, its trump card, its pride, its joy, and its biggest gamble. And possibly also its biggest fumble. 

But then why does the company seem so calm? In fact it seems they are in quite the peppy mood. Between October 2022 and January 2023 Cnergyico quietly established five new subsidiaries to manage its assets. Two were designed to oversee its refinery business, one for its oil marketing company’s (OMC’s) operations, one for its planned petrochemical venture, and another for the additional single point mooring (SPM)  it has approval for.