Abu Dhabi is likely to build a 200,000-barrels-per-day (bpd) refinery in southwestern Pakistan, that will double the country's refining capacity, Pakistani Prime Minister Shaukat Aziz said.
'We have given an initial go ahead to the government of Abu Dhabi to build this plant,' said Aziz, who was speaking at the inaugural session of a three-day energy conference in Islamabad.
To be built at Khalifa Point in the Hub district of Baluchistan province, about 15 km west of the port city of Karachi, the refinery will have a refining capacity of 200,000 bpd middle distillate products.
Aziz said the Pakistani government was in the process of finalising the refinery project with Abu Dhabi.
Abu Dhabi has a 40 per cent stake in Pakistan's biggest refinery, the Pak-Arab Refinery, in Mehmood Kot in the central province of Punjab.
Aziz said the new $2 billion refinery would also enable Pakistan to export petroleum products.
'Khalifa Point will clearly add to Pakistan's refining capacity and more importantly we are, for the first time, going in a serious way in the export market.'
Pakistan, almost totally dependent on oil imports, has an installed refining capacity of 12.82 million tonnes a year (just over 250,000 bpd) from its five refineries.
Last year, the refineries produced 11.33 million tonnes, according to official figures. Pakistan consumes about 15 million tonnes of oil products annually.
The oil import bill for the 2005/06 fiscal year (July-June) exceeded $6.5 billion, compared with $4.4 billion the previous year.
Another refinery, the Indus Refinery, is under construction in Karachi. It will have capacity to process 4.2 million tonnes of crude oil a year (about 84,000 bpd), and will be completed by December at a cost of about $250 million.
Pakistan's annual energy requirements are expected to more than double to 177 million tonnes of oil equivalent by the year 2020 from the current 58 million tonnes.
Aziz said the country's newly constructed deep-sea Gwadar port had the potential to be an outlet for Central Asian oil and gas supplies to other countries in Asia. The government is providing incentives, regulatory framework and infrastructure in Gwadar to ensure it becomes a main regional port and economic hub, he said.
'We are encouraging construction of oil refineries and large-scale storage of petroleum products in Gwadar,' Aziz said. 'We're also planning phase two of Gwadar making it an energy city.'
Pakistan plans to inaugurate Gwadar, on the Arabian Sea in the southwestern province of Baluchistan, in March.
Dana Gas in Egypt
Dana Gas said a subsidiary would drill 15 wells in Egypt this year as part of plans to expand its exploration and production business.
Canada-based oil and gas explorer Centurion Energy International, which Dana Gas acquired in January for $979 million, will drill 10 exploration and five development wells in Egypt in 2007, Dana Gas said in a statement.
Dana was set up to deliver gas to utilities and industrial users in the UAE. With an agreement to import Iranian natural gas delayed, the company has virtually no operating income.
Dana, the UAE's largest listed energy company by market value, said last month its 2006 net profit consisted entirely of investment income and money made from an initial public offering in 2005.
'Dana Gas will soon be expanding into exploration and production activities in other countries in the region, and we are currently pursuing a number of opportunities of this type,' Dana Gas general manager Rashid Saif Al Jarwan said in the statement. He gave no more details.
Centurion has completed its first sales of liquefied petroleum gas at a newly commissioned plant in Egypt, home to 70 trillion cubic feet of proven natural gas reserves, Centurion president Hany El Sherkawi said in the statement.
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