Islamabad: A Memorandum of Understanding (MoU) is likely to be signed between Pakistan and Saudi Arabia in February for the establishment of a mega oil city at the Gwadar deep seaport city, an ultimate destination of the China-Pakistan Economic Corridor (CPEC). Prior to signing the agreement, a high-level Saudi delegation headed by Minister for Energy, Industry, and Minerals Khalid Abdul Aziz D Al Falih visited the port city on January 12 to inspect the site for a proposed oil refinery and review necessary arrangements for the MoU. They said Chief Executive Officer of Aramco Associates Company Al Buainain Ibrahim Qassim was also part of the delegation. The company will construct a petrochemical complex which will house the multi-billion dollar oil refinery. As per the plan, the oil city would be constructed on around 80,000 acres land with the purpose to refine and store imported oil for onward transportation to China using the CPEC route, besides developing the fuel supply chain for the landlocked Central Asian states. The fuel transportation to China via Pakistan would take just seven days as an import through western China takes almost 40 days. “Currently, oil vessels take 40 days to reach China, while through Pakistan the oil supply will reach China within seven days,” a source said. Federal Minister for Petroleum and Natural Resources Ghulam Sarwar Khan, who had received the Saudi delegation in Gwadar, had described the refinery a “state-of-the-art facility”. He said it would be the biggest investment of Saudi Arabia in Pakistan. During the visit, Saudi Minister Khalid Abdul Aziz D Al Falih highlighted the strategic importance of the Gwadar port, saying that it would become the economic hub in the region after completion of the CPEC. Replying to a question, the sources said the government was making all-out efforts to upgrade existing oil refineries and establish new deep conversion facilities to achieve self-sufficiency in this sector. “For the purpose, the government has recently banned the import of furnace oil and announced unprecedented incentives package for setting up new deep conversion oil facilities,” he said. The government, he said, had advised the existing oil refineries to enter into commercial agreements with power producers for utilization of their capacity for furnace oil storage and modernization of their facilities.