KARACHI: Pakistan Refinery Limited (PRL) is eyeing $5 billion investment after an upgrade at all its existing refineries, which will result in 5 deep conversion refineries collectively capable of refining around 350,000 barrels per day (bpd) of crude oil, Tariq Kirmani, chairman of the board of directors at PRL, said in a statement.
The company is making strides towards enhancing and modernising its refining capabilities through a Refinery Expansion and Upgrade Project (REUP).
The transformative endeavor aims to propel PRL into a sustainable future, producing cleaner and environmentally friendly fuels, while meeting growing market demands.
However, the urgent need for a comprehensive refining policy to support the industry’s development and attract investments remains a pressing concern, according to PRL.
Kirmani advocated for a brownfield policy that’ll empowers existing refineries to undertake essential upgrades. “The payback from a brownfield policy far exceeds the benefits anticipated from a greenfield policy,” he said.
With an estimated investment of circa $4-5 billion, according to PRL board chief, the approach would lead to upgrading all existing refineries, eventually resulting in 5 deep conversion refineries, collectively capable of refining around 350,000bpd of crude oil.
The REUP project involves expanding the crude processing capacity from 50,000bpd to 100,000bpd. PRL is working to adopt a deep conversion refinery configuration, equipped with advanced technology that adheres to stringent environmental protocols, including the production of EURO V standard fuels, according to the company statement.
“The significance of the PRL REUP is multi-faceted. It not only ensures compliance with international fuel standards, but also generates substantial employment opportunities, stimulates economic activity, and fosters skill development by training professionals on state-of-the-art licensed technology,” it said.
The project would contribute to the national GDP, reduce import dependency, and promote import substitution, resulting in substantial savings of valuable foreign exchange, PRL stated. “By increasing local production of refined products, the REUP project enhances energy security and lays the foundation for a self-sufficient and sustainable energy sector.”
PRL said despite a significant devaluation of the rupee, which has nearly doubled the cost of the Front-End Engineering Design (FEED) work for PRL, the board of directors reaffirmed their dedication to the project during a recent board meeting.
“The FEED work, currently underway and progressing satisfactorily, is envisaged to be completed by Q4, 2024.”
The company also intends to shortly execute multi-million dollar contracts for acquisition of critical technology Licenses, which are essential to progress FEED work. EPC tenders are also planned to be floated by Q4, 2024.
Kirmani called for government support for a policy addressing upgrade of existing refineries.
“The government must take this initiative to create an enabling environment that fosters growth, incentivises investments, and promotes objectives of
self-sufficiency and energy security,” he said.
According to the company, REUP is more cost saving compared to alternative refinery constructions. “However, to fully capitalise on this opportunity, the industry’s challenges must be addressed,” it said.
