The $3.5 billion Falcon Oils Refinery and Storage Complex proposed for Dhabeji in Sindh’s Thatta district has cleared a key institutional stage after the China Pakistan Economic Corridor (CPEC) Secretariat endorsed the project and asked the Board of Investment to present the proposal before the Joint Working Group on Industrial Cooperation. The development represents a major proposed private sector investment in Pakistan’s petroleum and energy infrastructure and could become one of the country’s larger privately sponsored industrial projects in recent years.
According to an Office Memorandum issued by the CPEC Secretariat at the Ministry of Planning, Development and Special Initiatives on August 24, 2026, Falcon Oils (Pvt) Limited has proposed a 100,000 barrels per day deep conversion refinery. The planned development will also include a large petroleum storage complex and a captive power generation facility. The CPEC Secretariat’s endorsement allows the proposal to progress through the formal industrial cooperation mechanism associated with the second phase of CPEC.
The memorandum, numbered CPECS/IC(14)/601/2026, supports the inclusion of the Falcon Oils project within the CPEC framework as a business to business initiative. The proposed structure is consistent with the focus of CPEC’s second phase on expanding private sector participation and strengthening commercial cooperation between Pakistan and China. The project is therefore being positioned as a privately driven industrial undertaking rather than a government financed development.
The proposed complex is expected to have storage capacity of 4 million tonnes for crude oil and petroleum products. It will also include a 50 megawatt captive power plant to support the facility’s operations. The refinery is planned to produce Euro V compliant fuels, which could contribute to an expansion of Pakistan’s domestic refining capacity and reduce dependence on imported finished petroleum products.
Falcon Oils has already established Chinese technical and engineering involvement in the project. According to the CPEC Secretariat memorandum, the feasibility study was prepared by Xinjiang Petroleum Engineering Design Co Ltd. Engineering, procurement and construction arrangements have also been signed with CEEC GEDI/CGGC, providing the project with Chinese technical and engineering participation as it advances toward the next stage.
The location of the proposed refinery is another significant element of the project. Dhabeji is situated in Sindh’s coastal industrial belt and is located close to Karachi’s port facilities and existing infrastructure associated with crude oil imports and petroleum distribution. This location could support the planned refinery’s operations by providing access to imported crude as well as distribution networks for petroleum products across domestic markets.
The development could also have implications for Pakistan’s energy security. A larger domestic deep conversion refining capacity could allow the country to shift part of its petroleum import requirements from finished petroleum products toward crude oil. Alongside refining capacity, the planned 4 million tonnes of storage would provide substantial additional infrastructure for crude and petroleum products.
Falcon Oils has stated that the refinery and storage complex will be developed and financed entirely by private sponsors. The project is planned on a fully non recourse basis, meaning it will not require a sovereign guarantee or financial or other recourse to the Government of Pakistan. This financing structure places the investment responsibility with the private sponsors while keeping the proposed development within the business to business framework supported by the CPEC Secretariat.
The project is also expected to generate employment opportunities during its construction phase and create permanent jobs in Thatta district once operational. The development could add a major industrial facility to the Dhabeji area and contribute to broader economic activity around the region’s industrial and port related infrastructure.
Falcon Oils Chief Executive Officer Sirhaan Ahmed Khan confirmed the development and described the CPEC Secretariat’s endorsement as an important step in advancing the project through the formal CPEC industrial cooperation process. The next stage will involve the Board of Investment taking the proposal before the Joint Working Group on Industrial Cooperation for further consideration.
With the proposal now moving toward the Joint Working Group, Falcon Oils’ planned 100,000 barrels per day refinery has entered a significant phase in its development. If implemented, the facility would add considerable refining and storage capacity to Pakistan’s energy infrastructure while representing a major privately financed investment under the second phase of CPEC and demonstrating the potential role of private capital in future Pakistan China industrial cooperation.
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