ISLAMABAD: Pakistan has renewed efforts to attract Saudi investment in a long-delayed $10 billion oil refinery project at Gwadar, as growing trade activity at the strategic port strengthens its position as a regional energy and logistics hub.
Government officials have once again urged Saudi Arabia to establish an oil refinery and strategic fuel storage facilities at Gwadar Port, a project first proposed during the 2019 visit of Saudi Crown Prince Mohammed bin Salman to Pakistan.
The renewed push comes as activity at Gwadar Port has reportedly increased by around 30 percent in recent months, driven by rising transshipment traffic and changing regional trade dynamics. Officials believe the port’s importance as a transit and energy hub is likely to grow further in the coming years.
The Ministry of Maritime Affairs recently presented a range of investment opportunities to Saudi investors during a virtual meeting with the Pakistan-Saudi Arabia Joint Business Council, including the proposed Gwadar refinery project. Discussions were expected to continue during a visit by a Saudi delegation led by Joint Business Council Chairman Mansour bin Mohammed Al Saud, but the scheduled meeting was postponed.
In addition to the refinery project, Pakistan has invited Saudi investors to participate in the development of liquefied petroleum gas (LPG) and liquefied natural gas (LNG) terminals at Karachi Port. Authorities have also offered land for industrial development and highlighted opportunities in petrochemical projects.
The government, through the Special Investment Facilitation Council (SIFC), is leading efforts to attract Saudi capital and address concerns raised by foreign investors regarding policy continuity and bureaucratic obstacles. Officials say reforms and investment facilitation measures are being implemented to improve the business environment and accelerate project approvals.
Saudi Arabia had previously announced plans to invest $20 billion in Pakistan, including $10 billion earmarked for the Gwadar refinery project. However, the investment has yet to materialize. Pakistani officials now believe enhanced bilateral cooperation and closer strategic ties between the two countries could help revive the initiative.
Pakistan has also offered Saudi Arabia a 15 percent stake in the Reko Diq Project copper and gold mining venture and invited investment in the proposed Energy City at Gwadar, where oil-producing nations could establish strategic petroleum reserves.
According to officials, Pakistan is encouraging international energy producers to build strategic oil storage facilities in the country by offering incentives, including potential tax holidays. While such reserves could support regional energy trade, the government would retain priority access during emergencies.
At present, Pakistan remains one of the few countries in the region without strategic petroleum reserves, relying primarily on commercial stocks maintained by oil marketing companies and local refineries. Officials believe establishing strategic reserves and a major refinery at Gwadar would significantly strengthen the country’s energy security and enhance its role in regional energy trade.
Story by Zafar Bhutta
