KARACHI – A private refinery has become the first in Pakistan to import private-sector shipment of Russian crude oil as Moscow is offering discount on its oil exports following the Ukraine war.
The development comes months after the Pakistani government imported first cargo of Russian oil in June this year while talks for the second shipment are underway between both governments.
It has also put the assumptions to rest that it would not be commercially viable for private sector to import oil from Russia. There were several concerns, including handling of the large tankers at the Pakistan’s port.
But the Pakistani refinery named Cnergyico managed to accommodate deep-draft tankers. A company spokesperson the crude oil would be refined at the company’s refinery in the southwestern city of Hub.
In 2012, Cnergyico successfully commissioned the largest refinery in the country. This new refinery was installed near the existing refinery and has a capacity of 120,000 barrels a day, bringing Cnergyico’s total installed refining capacity to 156,000 barrels per day, the highest in all of Pakistan today.
That same year, Cnergyico achieved another milestone by successfully commissioning Pakistan’s first and only Single Point Mooring (SPM). This floating port is located 13 km offshore in the Arabian Sea near Charna Island. Cnergyico’s SPM has the capacity to handle very large petroleum cargo vessels (VLCC’s), and gives Cnergyico a distinctive competitive strategic advantage in Pakistan’s petroleum industry.
Cnergyico manages more than a quarter of all petroleum sold in Pakistan and is the nation’s only vertically integrated Oil Company.
The company plans to sell gasoline and diesel refined from the Russian crude locally, and export furnace oil, which is used in industrial boilers, power plants and others.
The spokesperson told media that there was a great demand for furnace oil in the global market, which can help Pakistan generate foreign exchange.
It is recalled that the government paid in Chinese yuan for its first import of discounted Russian crude, which was processed by state-run Pakistan Refinery Ltd.
However, the company has refused to comment on a question regarding the currency used for making payment to Russia.
How much discount Pakistan has received on Russian crude oil?
