Sinopec invited to collaborate with Aramco
Pakistan State Oil (PSO) has reached out to M/s Sinopec, a leading Chinese energy
company, to join forces with Saudi Arabia’s Aramco in building an advanced
refinery and petrochemical complex within Pakistan.
In a correspondence addressed to the President of Sinopec Corp, Yu Baocai, PSO’s
Managing Director/CEO, Syed Muhammad Taha, expressed PSO’s eagerness to
engage Sinopec, a global energy frontrunner, in a significant greenfield refinery
and petrochemical venture in Pakistan.
Moreover, the government plans to integrate the $10 billion Saudi Aramco
refinery venture into the framework of the China Pakistan Economic Corridor
(CPEC).
According to Taha, this collaborative project, spearheaded by PSO and Saudi
Aramco, aims to establish a cutting-edge refinery and petrochemical hub in
Pakistan with a processing capacity exceeding 300,000 barrels per day (bpd),
catering to a variety of high-value petroleum products including gasoline, diesel,
and jet fuel, alongside petrochemicals.
Furthermore, the project has been incentivized by the Pakistani government to
enhance its economic viability, offering incentives such as a 20-year tax holiday,
deemed duties of 7.5% for 25 years on gasoline and diesel production, and tax
exemptions on imported equipment/materials for the project.
PSO and Aramco view Sinopec as the ideal partner due to its stellar track record in
the energy sector. As a global energy behemoth with extensive experience in
refinery and petrochemical ventures, Sinopec possesses the requisite technical
prowess and financial prowess necessary for the project’s success.
The government is poised to devise a new policy framework to facilitate
investment from Saudi Aramco, particularly in the establishment of a crude-to-
chemical/plastic complex. This decision was made during a recent meeting of the
Apex Committee of the Special Investment Facilitation Council (SIFC), chaired by
caretaker Prime Minister Anwar ul Haq Kakar.
According to insider sources, the Petroleum Division and Ministry of Industries
and Production (MoI&P) will collaborate to formulate a policy framework aimed
at attracting investment from Saudi Aramco in conjunction with Chinese firm
Sinopec Engineering Group (SEG). Notably, Pakistan’s Deputy Ambassador to
China has engaged in discussions with Chinese company representatives
regarding the $10 billion project’s feasibility and potential.
