Oil Refineries in Pakistan Set for Multi-Billion-Dollar Plant Upgrades

Federal Minister for Finance and Senator Muhammad Aurangzeb held a meeting today with a delegation comprising Chief Executive Officers (CEOs) of Pakistan’s leading oil refineries at the Finance Division. During the meeting, the refinery heads briefed the minister and his team on their upcoming investment plans, which include multi-billion-dollar plant upgrades aimed at enhancing the domestic production capacity of petrol and diesel. The delegation highlighted that these upgrades, once implemented, have the potential to save the country close to $1 billion annually in foreign exchange by reducing reliance on imported refined fuels. The refinery representatives also raised concerns regarding the change in the sales tax regime on petroleum products, specifically the shift from zero-rated to exempt supplies. They explained that this change has led to a significant increase in both operational and capital expenditure for the refining sector, adversely impacting the financial viability of their planned upgrades. Aurangzeb welcomed the delegation and appreciated the vital role played by the refining sector in strengthening Pakistan’s energy security and reducing the import bill. He assured the CEOs that the government would carefully review their concerns, especially those relating to the sales tax exemptions, and added that the issue would be addressed in a manner that supports the continued growth and modernization of the domestic refining industry.