Saudi Arabia to Install $12 Billion Aramco Oil Refinery Unit in Gwadar
Saudi Arabia has decided to build a $12 billion Saudi Aramco Oil Refinery unit in Balochistan’s Gwadar district.Well-informed sources said the Government of Pakistan expended significant effort to persuade the KSA to uphold its past agreements and put more money in Pakistan. The current government has also thrown its support behind Saudi Arabia, which is at odds with the United States over a reduction in global oil supply.
Saudi Arabia’s energy minister Khalid Al-Falih arrived in Pakistan over the weekend and has already visited the deep-water port of Gwadar to review the site of the planned oil city. He and his team were received by top representatives of the coalition government. The visiting Saudi delegation and their hosts discussed plans for signing a number of investment agreements in the coming month, including petrochemical, refining, renewable energy, and mining.
Talking to reporters, Al-Falih said, “Saudi Arabia wants to make Pakistan’s economic development stable through establishing an oil refinery and partnership with Pakistan in the China-Pakistan Economic Corridor (CPEC)”.
According to the Saudi official, who is also the Chairman of the Board of Saudi Aramco, bilateral relations between Pakistan and Saudi Arabia are very strong, “and Saudi Arabia will play a role in Pakistan’s development and prosperity through investment”.
A high-level delegation from the Kingdom of Saudi Arabia, led by the Crown Prince, will visit Pakistan in the last week of November. The Crown Prince is in Pakistan at Prime Minister Shehbaz Sharif’s invitation. Pakistan made significant efforts to convince the KSA to fulfill the MoUs and invest in Pakistan.
Besides the Saudi oil project, the Ministry of Petroleum is working to improve Pakistan’s refining policy in order to attract investment for the construction of new refineries. Reports suggest the government has decided to offer investors a profit margin of 14-15 percent, as opposed to the earlier offer of 9 percent in the draft for policy refinement prepared by the previous government.
The coalition also wants China to assist in the construction of another refinery on the CPEC strip, and Prime Minister Shehbaz Sharif is expected to present relevant plans to Beijing during his upcoming visit to China.