Page 14 - DMEA Week 24 2021

DMEA REFINING DMEA

Saudi shifts site of

planned Pakistan refinery

MIDDLE EAST STATE-OWNED Saudi Aramco will no longer Gwadar’s infrastructure issues being resolved
build an oil refinery at Pakistan’s deepwater port within the next 15 years. The official suggested
of Gwadar in Balochistan Province, shifting the that Riyadh had been irked that Pakistan had
facility to Karachi alongside a new petrochemi- agreed a similar-sized energy investment pack-
cal complex. age with Moscow, though the projects covered by
In early 2019, Saudi Arabia’s Crown Prince that deal are also yet to make progress.
Mohammed bin Salman (MbS) pledged around Meanwhile, a company hired to carry out a
$20bn of investment in Pakistan’s energy and feasibility study on the Gwadar unit said it had
mining sector, which included $10bn to build the advised its Saudi client against proceeding.
250,000-300,000 barrel per day (bpd) greenfield Also speaking to Nikkei, Arif Rafiq, presi-
refinery. dent of Vizier Consulting, said: “Saudi interest
Aramco had been due to supply the bulk has shifted closer to Karachi, which makes sense,
of the crude feedstock for the facility, which is given its proximity to areas of high demand and
likely be developed in a joint venture with Islam- existing logistics networks.”
abad-owned Pakistan State Oil. Gwadar is under development by Beijing as
Speaking to Nikkei Asia, a Pakistani official part of the so-called China Pakistan Economic
said that the development of the refinery was Corridor, designed to connect China’s western
never feasible. Xinjiang region with the Arabian Sea.
“Gwadar can only be a feasible location of an Pakistan suffers from an oil products short-
oil refinery if a 600-km oil pipeline is built con- fall – the capacity of the six existing refineries,
necting it with Karachi, the centre of oil supply of including one part-owned by the Abu Dhabi
the country.” Karachi is currently only connected government, stands at 400,000 bpd against
to the north of Pakistan, not the east. domestic consumption of around 600,000 bpd.
He added: “Without a pipeline, the transport The country’s upstream production is run-
of refined oil from Gwadar [via road in oil tank- ning at just under 100,000 bpd and Aramco is
ers] to consumption centres in the country will already the second-largest crude supplier after
be very expensive,” adding that he does not see the UAE.™

P14 www. NEWSBASE .com Week 24 17•June•2021