Pakistan and Saudi Arabia forge historic partnership for oil refinery project
In a significant stride towards deepening economic cooperation, Pakistan and Saudi Arabia are poised to sign a landmark agreement for the construction of a $10 billion oil refinery project in Hub, Balochistan. The project, to be undertaken by Saudi Aramco in collaboration with Pakistani state-owned companies, including Pak-Arab Refinery Company (PARCO), Pakistan State Oil (PSO), Oil and Gas Development Company Limited (OGDCL), and others, will mark a major milestone in the economic ties between the two nations.
Key Features of the Project:
- Location: The refinery will be established in Hub, Balochistan, leveraging the strategic location to enhance economic activity in the region.
- Capacity: The refinery is designed to process 300,000-450,000 barrels of crude oil per day, producing 8 million tonnes of diesel and 6 million tonnes of gasoline annually, meeting Euro 5 specifications.
- Investment: The project will be financed on a 30:70 equity-loan ratio, with Saudi Aramco and Pakistani companies contributing to the equity.
- Benefits: The project is expected to create thousands of jobs, stimulate economic growth, and enhance local infrastructure, including storage facilities and transportation networks.
Strategic Significance:
The oil refinery project is a testament to the strengthening economic ties between Pakistan and Saudi Arabia. By collaborating on this project, both countries aim to ¹ ² ³:
- Enhance Energy Security: Reduce Pakistan’s reliance on imported refined petroleum products and improve domestic energy production.
- Promote Economic Growth: Generate employment opportunities, stimulate economic activity, and increase revenue for the province of Balochistan.
- Foster Industrial Development: Develop infrastructure, including storage facilities and transportation networks, to support the growth of industries in the region.
A New Era of Cooperation:
The successful implementation of this project will mark a significant milestone in Pakistan-Saudi Arabia relations, paving the way for further collaboration and mutual benefits. As Pakistan continues to facilitate investments through transparent policies and community engagement, the oil refinery project is poised to drive long-term prosperity and economic independence for Balochistan .
The recent Defense Pact signed between Pakistan and Saudi Arabia marks a turning point in regional cooperation, with Pakistan emerging as a key strategic partner in safeguarding shared interests. This development not only reaffirms Pakistan’s growing leadership on the global stage but also signals a shift where other Islamic nations are now exploring participation in this landmark agreement, reinforcing unity, strength, and collective security in the region.
This spirit of collaboration also sets the stage for Economic and Industrial Partnerships, particularly in the Energy and Petroleum Sectors, where Pakistan
is already making its mark. As a AAA-rated, IMS-certified leader in the refining and petroleum industry, PARCO stands at the forefront backed by a highly skilled and experienced workforce, and a proven track record in energy infrastructure.
With deep-rooted expertise and strategic vision, PARCO is well-positioned to join hands with Saudi Arabia and other Middle Eastern Nations, leveraging shared oil wealth and technical capability to drive regional economic growth. Just as Pakistan is now taking the lead in defense cooperation, we envision PARCO leading in regional energy collaboration, fueling prosperity, innovation, and a resilient future.
