Pakistan Approves $6 Billion Oil Refinery Upgrade Policy
The Pakistani government has finally approved the Brownfield Refining Policy to modernize its oil refineries, after six years of deadlock. The policy aims to upgrade existing refineries, improve product quality, and increase production by an estimated $6 billion investment.
The policy provides stability clauses to protect investment, tax incentives, foreign exchange accounts for machinery import, and enhanced storage capacity for greater energy security. It also sets Euro-V emission standards, which will reduce harmful vehicle emissions by cutting down Sulphur and Benzene content.
The five existing refineries must upgrade their facilities to produce environmentally friendly fuels meeting Euro-V specifications and maximize the production of motor gasoline, diesel, and other value-added products. The government has introduced incentives for refineries that commit to the Upgrade Project, including binding agreements between refineries and oil marketing companies (OMCs) for smooth supply chain.