ISLAMABAD: Refinery sector asked the Petroleum Division to get the refining policy approved as delay may jeopardise the refineries upgradation plans worth $4-5 billion and another $10 billion investment in green field refinery.
In a letter to the Petroleum Division, refinery sector says refineries have been emphasizing the need for approving the draft refinery policy which was diligently prepared by the Petroleum Division in consultation with refineries over the last two years. This would enable the refineries to modernise and increase their production capacities.
It was envisaged that proposal along with approval of new Refining Policy would allow the existing refineries to up-grade their respective units to produce Euro V compliant fuels with increased production.
Refineries floated proposal to the Ministry of Energy (Petroleum Division) for running approximately 1,500 MC equivalent furnace oil (FO) based power plants on a regular basis.
On March 31,2022, the CEOs and MDS refineries, chairman Oil and Gas Regulatory Authority (OGRA) held meeting with the Secretary Petroleum on refineries role in averting products availability crises. In meeting directions were given to all refineries to enhance their productions to meet the growing demand of petroleum products in the country especially FO and diesel.
Refineries gave assurance that they will certainly endeavour to enhance their respective throughputs especially maximization of FO production keeping in view problems in getting regular LNG supplies from the international markets.
In December 2021 and January 2022, the refineries were struggling to operate due to high stocks of FO with little or no consumption in the power sector. Some of the refineries even had to shut down their operations because of issues and some had to export FO at substantial financial loss.
This cycle of scarcity and glut of FO has not happened for the first time and the country has been confronted by such crises the past too.
In order to avoid repeated recurrence of such situation, it is critically important to find a permanent solution which would enable maximum utilization and sustainability of the refining sector and also ensure availability
of petroleum products to the maximum possible extent.
Copyright Business Recorder, 2022
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