Pakistan: Growing Domestic Fuel Demand Pakistan Plans to Increase Refining Capacities
Quoting Bloomberg, Downstream Today reports, that Pakistan seeks to build two new oil refineries to decrease the country's dependence on imports.
Islamabad/Pakistan – Pakistan is seeking to build two new oil refineries in a bid to eliminate refined fuel imports within seven years and meet surging demand at home. The refineries, with a planned combined capacity of 24 million tons a year, are going to be built in the provinces of southwestern Balochistan and central Punjab, according to Petroleum Minister Shahid Khaqan Abbasi. While Pakistan already has five refineries, they aren’t working to full capacity as they are aging and cannot break down crude oil efficiently, Downstream Today cites the Minister.
South Asia’s second-largest economy purchases about 15 million tons of petroleum products each year, with the nation’s gasoline consumption increasing by 23 % annually in the past five years, according to Abbasi. Pakistan spent $ 7.6 billion on fuel imports in the fiscal year through July 1, the equivalent of about a third of its foreign reserves.
Pakistan’s demand for fuel is rising as Prime Minister Nawaz Sharif seeks to boost economic growth to an annual 7 % within the next two years on the back of Chinese investment announced last year of about $ 46 billion. Energy shortfalls are costing Pakistan as much as 2 % of gross domestic product each year, Planning Minister Ahsan Iqbal said in an interview in Islamabad on Monday.