Proposal to upgrade oil refineries hailed

Mian Zahid Hussain, President of the Pakistan Businessmen and Intellectuals Forum, has lauded a proposed $6 billion investment to modernize Pakistan's five oil refineries. The refineries - PARCO, Pakistan Refinery, National Refinery, Cynergico, and Attock Refinery - have all expressed their willingness to sign agreements under the government's Brownfield Refinery Upgradation Policy.

At present, these refineries process around 350,000 barrels of crude oil daily. Upon completion of the upgrades, they will be able to produce more environmentally friendly Euro-V-compliant petrol and diesel. Additionally, a significant portion of furnace oil, currently of low sale value, will be converted into higher-value petrol and high-speed diesel.

Mian Hussain anticipates an increase of 72 percent in domestic petrol production, a 39 percent rise in high-speed diesel production, and a decline of 63 percent in furnace oil production post-upgrades. This enhancement aims to lessen the nation's reliance on imported petrol and diesel. The ongoing conflict between the US and Iran, along with disruptions in the Strait of Hormuz, has further emphasized the urgency of upgrading Pakistan's refineries.

Pakistan currently imports nearly 90 percent of its oil and liquefied natural gas (LNG) through the Gulf routes and the Strait of Hormuz. While Pakistan cannot control international conflicts or global oil prices, enhancing its refining capacity, diversifying crude oil sources, and building strategic petroleum reserves can mitigate its vulnerability. The upgraded refineries will provide Pakistan with increased flexibility during geopolitical crises.

Mian Hussain commends Prime Minister Mian Muhammad Shehbaz Sharif and Federal Minister for Petroleum Ali Pervaiz Malik for overcoming long-standing policy delays. He anticipates the $6 billion investment to materialize after signing the agreements, securing foreign financing, and the projects becoming operational. Mian Hussain emphasizes the importance of stable taxation and a business-friendly environment, with independent monitoring to ensure tariff protection is exclusively used for upgrading plants and does not overly burden consumers.

Timely implementation of this project will yield employment, facilitate technology transfer, and improve environmental standards. However, further delays could leave Pakistan susceptible to inflation and future geopolitical shocks.