ISLAMABAD: The government’s plan to set up an oil or petrochemical refinery with China’s cooperation is almost a dead project as Chinese company M/s Sinopec is interested in trading petrochemical products on the basis of demand and supply, well-informed sources told Business Recorder.
Pakistan State Oil (PSO) is reportedly interacting with Bank of China/ Sinopec for establishment of either an oil refinery or petrochemical refinery with an investment of over $ 10 billion. Recently, Pakistan sought viewpoint of Chinese company which showed no interest in any type of refinery.
Minister for Planning, Development and Special Initiatives Ahsan Iqbal held a meeting with Vice President of Sinopec LV Lianggong to discuss prospects for establishing an oil refinery in collaboration with Pakistan State Oil (PSO) –Aramco –Sinopec. In response, Vice President stated that given the ongoing debate on climate change, the refinery business was contracting. Sinopec would therefore accord a careful consideration to that proposal. In the case of Pakistan, it took long time to process such proposals.
Refinery, petrochemical complex: PSO taps China’s Sinopec for partnership with Aramco
Sinopec has to evaluate the whole eco-system, which requires a network of pipelines, jetties, an analysis of the cost of inputs; and rate of investment. As Pakistan lacks such infrastructure, the cost of production would be too high, resulting in diminished rate of returns. Sinopec; however, would be willing to discuss trading of petrochemical products and that too on the basis of supply and demand.
Pakistan State Oil has approached Chinese energy firm M/s Sinopec to partner with Saudi Arabia’s Aramco in a state-of-the-art refinery and petrochemical complex in Pakistan as the latter has shown an interest in Saudi Aramco refinery project within the framework of the China-Pakistan Economic Corridor (CPEC).
In a letter to President Sinopec Corp, Yu Baocai, Managing Director/ Chief Executive Officer, PSO, Syed Muhammad Taha, conveyed PSO’s interest in inviting Sinopec, a global leader in the energy sector, to participate in a major greenfield refinery and petrochemical project in Pakistan.
A couple of months ago, in a letter to President Sinopec Corp, Yu Baocai, Managing Director/Chief Executive Officer, PSO, Syed Muhammad Taha, conveyed PSO’s interest in inviting Sinopec to invest in the project.
Copyright Business Recorder, 2024