PRL and UEG ink Historic $1.5 Billion deal in petroleum sector

The Pakistan Refinery Limited (PRL) and the United Energy Group of China (UEG) inked a significant memorandum of understanding (MoU), committing a substantial investment of $1.5 billion into Pakistan’s petroleum sector. This move, as stated by the Prime Minister’s Office (PMO), is a strategic step towards reducing Pakistan’s dependence on costly imported fuels, thereby mitigating its energy crisis.

The MoU was formalized during the ongoing 3rd Belt and Road Forum in Beijing, where Pakistan’s Caretaker Prime Minister Anwaar-ul-Haq Kakar and representatives from various developing nations, particularly from Latin America and Africa, are in attendance. The conference has brought together leaders to discuss critical global issues.

In the presence of Caretaker PM Kakar and Pakistan’s Caretaker Energy Minister Muhammad Ali, the agreement between the two entities was formally endorsed, as confirmed by the PMO’s official statement.

“The production of petrol and high-speed diesel from this refinery not only stands to replace costly imports but also envisages a surge in the refinery’s petrol production capacity from 250,000 metric tons to an impressive 1.6 million metric tons,” the statement outlined. Additionally, the agreement is poised to bolster the production capacity of high-speed diesel, escalating from 0.6 million metric tons to 2 million metric tons.

Given Pakistan’s limited domestic resources to sustain its oil- and gas-based power plants, a substantial portion of its external payments is allocated to energy imports. This financial strain compounds the nation’s existing economic crisis, characterized by a severe balance of payments deficit.