Oil refineries in Pakistan have raised a red flag that they might close down if the government does not stop shutting down oil-based power plants in both private and public sector. Oil refineries in Pakistan have been facing severe supply chain issues that are making it difficult for them to operate in the market.
Oil refineries have been running on below par capacity after Prime Minister Shahid Khaqan Abbasi ordered the closure of oil plants in favor of Liquefied Natural Gas (LNG) plants. Attock Refinery, in an SOS to the Ministry of Power and Energy, reported that they are facing operational difficulties in the country which can create severe shortage of petroleum products in the north region.
Not only had they warned about the shortages, Attock Refinery also said that if the situation continued like this, oil fields located in Pothwar and Khyber Pakhtunkhwa region would close down as well. The stock requirement of petrol and diesel currently stands at only 12 and 16 days as compared to the 21 days storage of commercial stock. The stock of light diesel and kerosene oil stood only at 7-8 days of storage, which is another sign of concern for the refineries.
Officials of the Petroleum department said that the oil refineries in the country are currently operating at a capacity of up to 75% while the storage tanks of these refineries are also full. CEO of Attock Refinery, Adil Khattak also confirmed this by saying that they are handling 40,000 barrels a day which cannot go for too long. He said that ullage problems being faced by their oil refinery is due to the shutdown of IPPs that were running on furnace oil.
PSO ordered six ships of furnace oil but decanting of those ships is not being allowed as there is a significant stock of oil at home and consumption is next to nothing.
Early in November, Shahid Khaqan Abbasi inaugurated Pakistan Oil and Gas Conference in which they announced that new oil refineries and transmission will be established with the help of pipelines instead of trucks. He also launched the Pakistan Energy Outlook 2017 as well.