Islamabad: The government’s latest structural changes to the Motor Spirit pricing mechanism are poised to inflict an estimated financial loss of Rs49 per litre on domestic refineries, threatening the future of critical multi-billion dollar upgradation projects. According to a formal communication sent to the government by Attock Refinery Limited Chief Executive Officer Adil Khattak, the adverse financial impact stems from two main policy changes. The decision to incorporate pre-war premiums and incidentals into the petrol pricing framework will cost local refineries approximately Rs35 per litre, while an additional diversion of Rs14 per litre from their customs duty recovery to reduce the Petroleum Levy brings the total deficit to Rs49 per litre.
Thank you for reading this post, don't forget to subscribe!This unexpected shift has raised urgent alarms over the viability of massive brownfield modernization projects, which carry an estimated aggregate investment of USD 5 to 6 billion. Industry leaders warn that altering the agreed financial framework after signing formal upgradation agreements directly undermines policy consistency, regulatory certainty, and the overall credibility of state commitments. The unilateral nature of the decision has also sparked criticism, with refinery representatives noting that the sector was entirely bypassed during consultations, risking a severe blow to investor and lender confidence at a critical stage when companies are aggressively attempting to lock in project financing.
