ISLAMABAD (February 08, 2011) : The Board of Management (BoM) of Pakistan State Oil (PSO), scheduled to meet on February 9, 2011, is expected to approve acquiring 30 percent shares of Shell International Petroleum Company Limited in Pakistan Refinery Limited (PRL), Business Recorder has learnt.
According to sources, due diligence exercise relating to acquiring shares of Shell Company in PRL has been completed and in this regard a study will be submitted before BoM for decision. The financial results of PSO will also be tabled before BoM. The Board of Directors of PRL had given provisional approval in this regard in its meeting held on June 30, 2010, subject to agreed purpose and terms of reference of the due diligence exercise. PRL supplies 30-40 percent of the fuel to PSO.
At present, PSO has 18 percent shares and, after acquiring the shares of Shell, its total shares would be 48 percent in PRL. The shares of other stakeholders will remain as follows: Caltex 12 percent, National Bank of Pakistan 8 percent, National Investment Trust (NIT) 6 percent and individual shareholders 26 percent.
The refinery is situated on the coastal belt of Karachi. Pakistan Refinery Limited is a hydro skimming refinery designed to process various imported and local crude oil to meet strategic and domestic fuel requirements of the country. The refinery has a capacity of processing 47,000 barrels per day of crude oil into a variety of distilled petroleum products such as furnace oil, high speed diesel, kerosene oil, jet fuel and motor gasoline, etc.
"After acquiring the shares, PSO would invest in the refinery to enhance its refining capacity by 50 to 70 percent to 100,000 barrels per day from existing 47,000 barrels per day to ensure confirmed source of refined fuel," sources said. "Due to circular debt issue, PSO is facing problems in fuel supplies and, after acquiring more shares in PRL, it would be secure in getting petroleum products," sources added. At present, fuel consumption has surged to over 9 million tons from 7.9 million tons due to greater reliance on thermal power generation. The refining capacity of oil refineries ranges between 2.6 million tons and 3.5 million tons. "The country depends more on imported products and after increase in PRL refining capacity; the country's reliance on imports will be reduced," they added.
This news article was published on 8 February, 2011 in Business Recorder
According to sources, due diligence exercise relating to acquiring shares of Shell Company in PRL has been completed and in this regard a study will be submitted before BoM for decision. The financial results of PSO will also be tabled before BoM. The Board of Directors of PRL had given provisional approval in this regard in its meeting held on June 30, 2010, subject to agreed purpose and terms of reference of the due diligence exercise. PRL supplies 30-40 percent of the fuel to PSO.
At present, PSO has 18 percent shares and, after acquiring the shares of Shell, its total shares would be 48 percent in PRL. The shares of other stakeholders will remain as follows: Caltex 12 percent, National Bank of Pakistan 8 percent, National Investment Trust (NIT) 6 percent and individual shareholders 26 percent.
The refinery is situated on the coastal belt of Karachi. Pakistan Refinery Limited is a hydro skimming refinery designed to process various imported and local crude oil to meet strategic and domestic fuel requirements of the country. The refinery has a capacity of processing 47,000 barrels per day of crude oil into a variety of distilled petroleum products such as furnace oil, high speed diesel, kerosene oil, jet fuel and motor gasoline, etc.
"After acquiring the shares, PSO would invest in the refinery to enhance its refining capacity by 50 to 70 percent to 100,000 barrels per day from existing 47,000 barrels per day to ensure confirmed source of refined fuel," sources said. "Due to circular debt issue, PSO is facing problems in fuel supplies and, after acquiring more shares in PRL, it would be secure in getting petroleum products," sources added. At present, fuel consumption has surged to over 9 million tons from 7.9 million tons due to greater reliance on thermal power generation. The refining capacity of oil refineries ranges between 2.6 million tons and 3.5 million tons. "The country depends more on imported products and after increase in PRL refining capacity; the country's reliance on imports will be reduced," they added.
This news article was published on 8 February, 2011 in Business Recorder
