Attock Refinery seeks approval for 5,000 bpd crude allocation to meet military fuel demands

Attock Refinery Limited (ARL) has formally requested the federal government to ensure the availability of 5,000 barrels per day (bpd) of crude oil from the Naimat field, a southern oilfield operated by United Energy Pakistan (UEP), to increase production of high-speed diesel (HSD) and jet fuel (JP-18) for the armed forces, The News reported.  

On April 23, the Directorate General (DG) of Oil, representing the federal government, instructed refineries to ramp up production of HSD for troop mobilization and JP-18 for the Pakistan Air Force. 

In response, ARL sent a letter on April 25 requesting swift approval of the freight rates for the 5,000 bpd crude allocation to ensure the refinery can meet the increased demand for military fuels.

The crude oil allocation from Naimat field was approved by the Economic Coordination Committee (ECC) in February 2024, and ARL is now seeking approval for the freight rates to facilitate transportation to the refinery.

According to the report, the ARL management highlighted a significant decline in crude oil production from the country’s northern oilfields, which has dropped to approximately 39,000 bpd. As a result, the refinery has been operating at a reduced capacity of around 39,000 bpd, significantly below its installed capacity of 53,400 bpd.

In its letter, ARL pointed out that it had first requested the allocation of 5,000 bpd of crude from the Naimat field in May 2022, which was approved by the ECC in February 2024, along with the reimbursement of freight costs through the Inland Freight Equalisation Margin (IFEM). 

However, delays in the approval process have prevented implementation of the decision. ARL resubmitted the revised freight rate proposal in September 2024, in line with Public Procurement Regulatory Authority (PPRA) rules, and is still awaiting approval.

The refinery management stressed the urgency of approving the freight rates for the Naimat field crude oil allocation, emphasizing the critical need to maintain optimal refinery operations to meet the growing demands for JP-18 and HSD, especially in light of the country’s security situation. 

Despite the challenges related to crude oil availability, ARL has reiterated its commitment to supporting the armed forces by ensuring an uninterrupted supply of essential fuels.