The oil refineries are involved in producing low quality products and are resisting up-gradation of plants, a senior official of Petroleum Ministry told a high level meeting of Ministry of Climate Change. The meeting was chaired by Minister for Climate Change Rana Farooq, which was also attended by Advisor to Prime Minister on Petroleum and Natural Resources, Dr Asim Hussain, here on Thursday.
On May 4, oil refineries while showing their inability to complete Hydro-Desulphurization (DHDS) plants within the prescribed period, ie by June 2014, has also refused to upgrade their plants until government did not stop providing additional subsidy of Rs 3.5 per liter on motor sprit (Petrol). According to the Petroleum Ministry official, the refineries since 2000 have obtained over Rs 150 billion from the government on account of up-gradation of their plants.
The official admitted that government has become hostage to the 'oil mafia' as oil refineries are allegedly involved in producing low grade products. Farooq observed that oil refineries should be bound to set up plants to introduce Euro-2 diesel for clean energy. He said that oil refineries should not be given more extension for up-gradation of their plants.
"Some times, refineries seek extension in date for setting up plants and some times they want money," he said adding that there should be strict enforcement roadmap for refineries to set up plants. Farooq added that the government should prepare a road map to introduce Euro2, 3, 4 and 5 diesels for clean energy in Pakistan. "Oil refineries are seeking more money to set up up-gradation plants," the official said, adding that one plant cost $300 to $400 million.
During the meeting, it was proposed to give six months period to refineries for setting up plants to introduce Euro-2.The participants noted that NRL and ARL were creating problems in this regard. The representative of Commerce Ministry said that India had introduced Euro-3 and Euro-4 diesel and auto manufacturers in Pakistan wanted to export vehicles to India. "Therefore, we need to go to Euro-2, 3 and 4 to capture the Indian auto market," he said.
The representative of Engineering Development Board (EDB) said that introduction of Euro-2 would require technology shift and therefore it would not be possible overnight. "We can not introduce Euro-2 in six months period because of old vehicles," he said adding that adulteration of oil is very common practice at petrol pumps. He said that majority of the petroleum pumps were involved in adulteration of oil and therefore it would continue after introduction of Euro-2.