Dr. Musadik Malik, Pakistan’s state minister for petroleum, is photographed speaking to a press conference in Islamabad, Pakistan, on July 28, 2023. (PNH picture)

In an extraordinary development, four Pakistani public entities came together to seal a trio of memorandum of understanding (MoUs) aimed at securing the necessary local equity for a massive multibillion-dollar Saudi refinery project. Adding to the intrigue, they also inked a highly anticipated engineering, procurement, and construction (EPC) contract with a renowned Chinese firm. Thursday witnessed Pakistan’s Minister of State for Petroleum, Musadik Malik, revealing the groundbreaking news.(pakistannewshub)

The project, a staggering $12 billion endeavour, is set to possess the impressive capacity to process between 350,000 to 450,000 barrels of crude oil per day. Interestingly, this audacious initiative was originally conceptualised during a momentous visit to Islamabad by none other than Saudi Crown Prince Mohammed bin Salman, back in 2019.

The key players in this ambitious venture include Pakistan State Oil, Oil and Gas Development Co., Pakistan Petroleum Ltd., and Government Holdings Private Ltd. Their collective goal is to secure the required local equity, and the signing of the three MoUs marked a significant step towards achieving that objective. The EPC agreement, on the other hand, was formally established in collaboration with the esteemed China National Offshore Oil Corp. and Pakistan’s very own Monarch International.

Reflecting on the process that led to this monumental alliance, Minister Musadik Malik shared some insights during the momentous MoU signing ceremony. “In our earlier discussions with Saudi authorities, there were two critical issues to address. Firstly, we needed to identify other potential equity partners. Pakistan was resolute that, if we believe in the viability of this project, we should actively participate by contributing our own equity,” Malik stated, emphasising the nation’s commitment.

“So far, we have successfully secured equity partnerships surpassing 40 to 45 percent,” he proudly revealed.

The collaboration between Pakistan, Saudi Arabia, and Aramco is no less than an honour, and numerous rounds of talks have been conducted to reach this defining agreement. Malik reiterated that the project has entered its final stages, with meticulous attention being paid to ironing out any potential issues. The ultimate goal is to establish a world-class refinery with a staggering capacity of approximately 300,000 barrels right here in Pakistan.

“As I said before, we are now at the spreadsheet level, meticulously addressing any and all concerns, to ensure that this world-class refinery becomes a reality,” Malik elaborated.

When it comes to the crucial matter of local equity, PSO is leading the charge with a significant 25 percent stake, and other firms have also pledged commitments ranging from 5 to 10 percent, surpassing the required amount.

Elaborating on the EPC aspect of the project, Malik was effusive in his praise for the Chinese firm they had brought on board. “We have already secured the expertise of world-class refinery EPC construction partners, who are not only contributing their technical excellence but are also becoming equity stakeholders,” he announced.

Intriguingly, Malik hinted at even more possibilities, indicating that the announcement of the new refinery policy had spurred further discussions with both the UAE and Azerbaijan for potential investments in the sector. It appears that this ambitious project has opened doors to greater opportunities and collaboration on an international scale.(pakistannewshub)

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