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capacity. Pakistani domestic oil production centers on the Potwar Plateau in Punjab and
lower Sindh province. 122 State-owned Oil and Gas Development Corporation Limited
(OGDCL) is a leading firm in the industry, producing around
22,334 bbl/d according to company information. A 5% stake was
sold in a public offering in November 2003 for approximately $119
million. OGDCL is Pakistan's second-largest oil producer after UKbased BP. The government will also offer a stake of up to 15% of
Pakistan Petroleum Limited (PPL), the largest exploration and
production firm in Pakistan. Currently the government controls
93% of the company, which owns the Sui fields in Balochistan, as
well as exploration interests in 22 blocks. The government also has a 35% stake in Pakistan
Oilfields Limited (POL).
Oil sector reforms in Pakistan are generally on track, but the privatization of several firms,
including Pakistan State Oil (PSO), continues to be postponed. The government's divestiture
of its 51% stake in PSO to a strategic partner has been planned for several years. PSO
holds a 60% domestic market share in diesel fuel and has more than 3,750 retail outlets.
Deregulation of prices for petroleum products is being pursued in parallel with the
privatization of PSO.
As part of the country's privatization process, Pakistan is setting up a Gas Regulatory
Authority (GRA) and the Petroleum Regulatory Board (PRB), which will separate out
government functions from state-owned companies to be privatized. Pakistan's government
hopes to reap significant revenues from these privatizations over the next several years. The
two most significant foreign oil firms in Pakistan are BP and Eni. BP operates 43 fields in
Pakistan and had reported average production of 25,877 bbl/d in 2003. Other firms include
BHP Billiton (Australia) OMV (Austria), Petronas (Malaysia) and Premier Oil (UK).
Pakistan's net oil imports are projected to rise substantially in coming years as demand
growth outpaces increases in production. Demand for refined petroleum products also
greatly exceeds domestic oil refining capacity, so nearly half of Pakistani imports are refined
products. Pakistan's Pak-Arab Refinery (PARCO) became operational in late 2000, adding
to the country's refining capacity, and alleviating refined product import dependence. The
PARCO Mid Country Refinery at Mahmood Kot was formally commissioned in 2001 and has
capacity of 100,000 bbl/d of throughput (mostly crude oil from Abu Dhabi and and Light
Arabian Crude from Saudi Arabia), supplied to the plant by pipeline from Karachi.
A small, 30,000 bbl/d refinery operated by private Bosicor Pakistan Limited (BPL) near
Karachi began commercial operation in November 2003. The plant is supplied with
shipments of crude oil from Qatar. The Bosicor plant will allow Pakistan to become a new
supplier of naptha to Far Eastern markets. Naptha makes up approximately 9% of the plant's
output. The plant produces about 10,800 bbl/d of fuel oil, 6,980 bbl/d of diesel, and 4,350
bbl/d of kerosene, among other...
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This note was uploaded on 10/02/2010 for the course MBA 32343 taught by Professor Samghouri during the Spring '10 term at Karachi Institute of Economics & Technology.
- Spring '10