I can recall the day the combustion system of my car stopped working. I towed it to the nearest workshop and came to know that the fuel filter, fuel pump and carburetor have been chocked due to accumulation of wax. The mechanic also told me that this has happened because you don’t drive car daily and the excessive wax present in petrol choked the lines etc. He also advised me to use HOBC instead of regular petrol. When I shared by experience with my other friends, they also confirmed facing similar problem. One of the findings was common that often HOBC is not available at all the outlets, even those located in the most posh areas.
This prompted me to talk to the owners of petrol pumps being run by different oil marketing companies OMCs. All of them gave me a copybook reply, “We don’t get enough supply of HOBC from OMCs”. When I probed further the finding was most surprising that only one refinery in Pakistan, Pak Arab Refinery (PARCO) produces HOBC. I also discovered that with the induction of cars based on latest technology consumption of HOBC has increased manifold but there has not been corresponding increase in its production in the country.
I continued my search and met two more surprises: 1) the other refineries operating in Pakistan are incapable of producing HOBC and the government owned the largest OMC, Pakistan State Oil Company is not keen in importing HOBC and 2) the second refinery of PARCO to be constructed at Khalifa Point, having a capacity to refine 250,000 barrel oil per day has been delayed. This should have commenced production by 2010. I also found out that even if the construction is done on ‘war footings’ at Khalifa Point refinery, it will not be possible to commence production by 2020.
The prevailing situation prompts following questions:
- What were the factors that didn’t allow PARCO to expand its ‘Mid Country’ refinery capacity?
- Why the sponsors deferred construction of ‘Khalifa Point’ refinery?
- Why other refineries continue to produce lower distillate?
- Why refineries (other than PARCO) are operating below optimum capacity utilization?
- Why huge quantities of POL products are being imported despite local refineries operating below optimum capacity utilization?
Finding replies of the above-stated questions is the responsibility of the incumbent government.
However,the prevailing situation offers a golden opportunity to foreign investors to examine investment potential of constructing new refineries as well as expanding prevailing capacities in Pakistan.
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- Defending Pakistan's territorial integrity
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- Energy Crisis in Pakistan
- Financial Inclusion program of SBP
- Geo political importance of Pakistan
- Geo Politics in South Asia and MENA
- Global Oil Glut
- Importance of remittances in pakistan's economy
- Investing in Commodities
- Investing in Pakistan stock market
- Investing in Pakistan Stock Market
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- Making textile insutry robust
- Mutual Funds in Pakistan
- Oil and Gas Production in Pakistan
- Pak Afghan Relations
- Pakistan Foreign Policy
- Pakistan Stock Market Weekly Review
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- Performance of cement industry in Pakistan
- performance of commercial banks in Pakistan
- Performance of commerciial banks
- Performance of energy sector companies
- Performance of Fertilizer Industry in Pakistan
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- Performance of power generation companies
- Performance of textile sector of Pakistan
- Robust agriculture in Pakistan
- State of Pakistan Economy
- State of Pakistan's economy
- State of Pakistan's Economy
- Taxing POL consumers
- Textile Exports of Pakistan
- US-Saudi oil war
- War between shale oil producers and OPEC
- Warehouse Receipt Financing in Pakistan
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