Fuelling the nation for the past many years, Pakistan State Oil (KSE: PSO) is the largest oil marketing company (OMC) in Pakistan that is involved in storage, distribution and marketing of various petroleum products. The OMC has motor gasoline, furnace, high speed diesel, kerosene, LPG, jet fuel, CNG, petrochemicals and lubricants in its portfolio of products.

PSO has the largest storage capacity of one million ton in the country, which is around 74 percent of the nation's total storage capacity. With the largest storage capacity, the OMC also has the vastest retail network that serve the automotive sector, and supplies fuel to the railways, aviation industry, armed forces, power projects and the agriculture sector.

As evident from the table, almost 23 percent of the company's shares are held by the government. And around 37 percent is distributed among banks, DFIs, insurance companies and mutual funds. PSO's strategic investments include 12 percent in Parco's White Oil Pipeline Project; 22.5 percent in PRL; 22 percent in Pak Grease Manufacturing Company Limited; 49 percent in Asia Petroleum Limited; and 62 percent investment in Joint Installation of Marketing Companies.

Operational Performance FY16

PSO's market share in FY16 was 55.9 percent (around 13 million MTs) that included a growth in market share of 4 percent in Black Oil products and a decline of 3 percent in market share of White Oil products. PSO sourced the total volume through local refineries and imports. This included the sourcing of 10 million tons imported through 182 vessels. During the year, the OMC sector witnessed growth in imports, which was primarily seen in motor gasoline and furnace oil.

During the year, PSO was also actively participating to introduce 92 Ron Motor Gasoline and Euro-II 500 ppm High Speed Diesel. It has introduced its premium retail fuels, which has spurred smaller players to follow the leader.

In FY16, PSO also executed Long Term Sales Purchase Agreement (SPA) with QatarGas in February, 2016 for import of LNG under G2G arrangement, and according to its Annual Report FY16 it is now receiving 2.25 million tons per annum of LNG from QatarGas, which will be ramped up to 3.75 million tons per annum. PSO also executed a 5-year Term Agreement with Gunvor for the supply of 0.75 million tons of LNG per annum. As per the Annual Report, these contracts will novate in third quarter 2017 to PLNG.