Biggest oil storage base in region
By Khalid Mustafa - The News
ISLAMABAD: The government is all set to establish an 'oil city' with
an investment of $40 billion at Gwadar Port to make it the biggest
crude and refined oil storage base in the region, a senior
government official told The News.
For this purpose, the government has allotted 12,500 acres of land
in Gwadar. It will be made available on lease at nominal rates to
interested parties for setting up refineries or making investment in
oil logistics and storage facilities.
The official said the project would be completed in two phases. In
phase-1, a 'petrochemical city' will be set up with an initial
investment of $12.5 billion. In this city, a big refinery, along
with petrochemical, oil logistics and storage complexes, will be set
up. In first three years, the refinery will be able to refine 10.5
million tonnes of oil annually. The capacity of this refinery will
be increased to up to 21 million tonnes in seven to nine years. The
official said the Chinese Petroleum Chamber would come up with $12.5
billion investment plan for the project. In addition to it, some
companies from the Middle East have also shown interest to set up
refineries at Gwadar Port.
Under the second phase of the plan, the capacity of refineries in
the 'oil city' will be enhanced to 63 million tonnes in fifteen
years," the official said. "We have allowed a Chinese company to
initiate the project for power generation and water de-salination
prior to initiating the construction of the 'oil city'," he added.
Reuters adds from Dubai: A consortium, including Dana Gas has signed
an agreement to develop a liquefied natural gas terminal in Karachi
at an estimated cost of $200 million, the UAE company said on
A statement said Dana Gas, Single Buoy Moorings (SBM) and US-based
Granada Group signed the memorandum of understanding for the LNG
terminal at Port Qasim, which would have an initial capacity of 3.5
million tonnes a year.
It said the consortium was holding talks with major LNG producers,
but did not name them. "Dana Gas has the objective to develop a
network of LNG terminals mainly in the MENA (Middle East and North
Africa) region and to tap into the LNG value chain including LNG
trading activities," the statement said. It said Dana Gas signed a
cooperation agreement with SBM, under which the United Arab Emirates
firm would focus on LNG marketing activities and SBM on the supply
and operation of LNG floating storage and regasification terminals.
"The newly formed alliance will initially target LNG terminal
projects in Pakistan, Lebanon and Kuwait," it said.
Pakistan, which has its own gas fields, expects to have a supply
deficit as soon as 2008. Plans to import LNG and pipeline gas from
Iran and Turkmenistan are based on projected gas demand growth of
about 6.5 per cent a year. Industry sources in Pakistan have said
they expected the LNG terminal to be completed around 2010.
Dana Gas was set up to deliver gas to utilities and industrial users
in the UAE. With an agreement to import Iranian natural gas delayed,
Dana Gas' second-quarter earnings came entirely from investments and
financing activity. The firm said it aims to invest in the upstream
gas industry in the Middle East, the transmission and distribution
sector and gas-related industries such as petrochemicals.
The statement said natural gas consumption in the Middle East has
been growing by an average 5.9 per cent a year in the last 10 years,
driven mostly by demand for power generation due to growing
populations and an industrialisation drive.