Pakistan Postpones Refinery Upgrade Agreement by 6 Months Amid Private Sector Disagreements

Pakistan has postponed the signing of the Implementation Agreement (IA) with local crude oil refineries for a further six months, citing disagreements with private refiners as a significant hurdle. The delay, primarily attributed to the country’s largest refinery, Pak-Arab Refinery Company (Parco), has exacerbated the situation.

The decision to extend the signing deadline reflects ongoing challenges in reaching a consensus among stakeholders. These delays underscore the complexities involved in finalizing agreements within the petroleum industry, particularly concerning crucial infrastructure upgrades.

Notably, earlier the final date for signing the the agreement with refineries was April 22, 2024, but now it has been extended for six months.

Notably, Pakistan Refinery Limited has signed the agreement with OGRA last November, but now it has to go again through this process, an official said.  

In response to these challenges, the Petroleum Division has engaged the Ministry of Foreign Affairs to facilitate meetings between Federal Minister for Petroleum Dr. Musadik Malik, Secretary Petroleum, and key stakeholders in the UAE, including the Energy Minister and CEO of Mubadala. These discussions aim to garner support for allowing Parco’s Board of Directors (BoD) to participate in the amended brownfield refinery policy.

Federal Minister for Petroleum Dr. Musadik Malik recently convened a meeting with the UAE ambassador to highlight the issue and solicit cooperation from the UAE government in resolving the matter. These diplomatic efforts underscore the significance of collaboration between nations in navigating challenges within the energy sector.