In an astounding development, Chinese firm East Sea Group Limited (ESGL) has kicked off a plan to establish a $4.5 billion oil refinery in Gwadar with an annual oil processing capacity of 8 million tons, Gwadar Pro reported on Monday.
According to an official document available to Gwadar Pro, the project will be constructed in two phases. The first phase will have an annual refining capacity of 5 million tons. East Sea Group will place at least six crude oil transshipment vessels totaling 2 million tons at Gwadar port in Pakistan every month, starting from and supporting its own oil source business, and will also provide oil transshipment and transshipment services for major Middle East oil-producing countries.
East Sea Group CEO Fang Yulong, who is also Senior Vice President of the Pakistan-China Joint Chamber of Commerce and Industry (PCJCCI) created a pleasant ripple while breaking the news of launching the mega project of building “Gwadar Petroleum Storage and Transportation Trading Centre” during the briefing at Think Tank Session at PCICCI secretariat last week. The idea to build an oil refinery was floated in a meeting between China Overseas Ports Holding Company (COPHC) Chairman Zhang Baozhong and Pakistan PM Shahbaz Sharif in June 2022.
Taking the matter as a priority, on the directives of PM Shahbaz a committee was constituted to facilitate the establishment of the refinery. In the first meeting of the committee on June 27, followed by a number of meetings under the chairmanship of the Secretary Petroleum Division, all stakeholders expressed their full support and readiness to facilitate the refinery.
According to sources in the Ministry of Energy (Petroleum Division), the proposal revealed that the refinery will provide a substantial storage capacity to Pakistan, enabling it to maintain reserves for a longer time and save foreign exchange.
The multi-billion dollar project, upon implementation, will provide an impetus to further investment in the petrochemical industry in Gwadar. Moreover, the proposal sought the assistance of relevant government departments to facilitate the formation and subsequent implementation of a broad-based policy framework to materialize the project.