Ahmed Khan Malik

 Pakistan Refinery Limited’s (PRL’s) expansion has led to an unprecedented production boost in the country’s oil and gas sector. In an extraordinary display of growth and efficiency, PRL achieved remarkable milestones in September 2023. With its ongoing Refinery Expansion & Upgrade Project (REUP), PRL set new records in production and sales, propelling the company towards a thriving future. The REUP is a transformative initiative undertaken by PRL, representing a turning point in Pakistan’s refining history. The project aims to enhance the refinery’s capabilities, increase production and augment positive margin product output. The Front End Engineering Design (FEED) value of the project stands at an impressive $40 million, emphasising PRL’s commitment to bolstering its refinery through strategic investments.

Zahid Mir, Managing Director and Chief Executive Officer of PRL, told WealthPK about the project’s significance, saying, “Long-term refinery sustainability depends on the upgrade project. The Board of Directors of PRL and the government of Pakistan are committed to the REUP through the Brownfield Refining Policy. This underscores our determination to position PRL at the forefront of the industry.” He said in September 2023, PRL achieved an unprecedented average feed rate of 5,340 tonnes, demonstrating operational excellence and efficiency. “The production of middle distillate soared over 77,000 tonnes, with diesel accounting for 73,423 tonnes, an all-time high.”

Remarkably, he maintained diesel sales in September 2023 reached an astounding figure of over 82,000 tonnes, marking the highest-ever diesel sales in a single month. “To maximise revenue and product availability, PRL took a strategic decision to convert Naphtha into Motor Spirit (MS), resulting in the production of over 26,000 tonnes of MS 92, another record achievement.” Furthermore, Zahid Mir said PRL had also taken strategic decisions such as changing the recipe and using crude to minimise negative margin product production. He added that the timely opening of Letters of Credit ensured the recipe change was effective. “These initiatives underline our commitment to achieving optimal production and revenue despite market challenges.”

PRL’s REUP is a monumental undertaking with a total project cost of approximately $1.6 billion. With the possibility of 25% of the project cost accessible from the escrow account, PRL is committed to ensuring the upgrade project’s success, he explained. CEO Zahid Mir further emphasised, “To get the maximum benefit from the Brownfield Refining Policy, PRL must increase its production, ensuring long-term benefits and additional incentives in the escrow account. “Our dedication and strategic decisions drive the demand for middle distillate and boost diesel sales, enabling us to achieve these remarkable milestones.”

“The ongoing REUP amplifies PRL’s determination to embrace innovation, enhance efficiency, and meet the evolving needs of the industry and the nation. Through strategic decisions, unwavering dedication, and a commitment to sustainability, PRL propels itself into the future, aiming not only for excellence but also for a lasting impact on the nation’s energy landscape,” he said.

Credit: INP-WealthPk