Pakistan’s long-delayed refinery modernisation programme is moving toward implementation, with five domestic refineries planning combined investments of around $4.5 billion to $5 billion in green fuel production, capacity expansion, bottom-of-barrel projects and related infrastructure upgrades. The investment plans are being advanced under the amended Brownfield Refineries Upgradation Policy, which has introduced a tighter deadline for refineries to move from commitments to formal implementation agreements.
According to a report citing official sources, the planned investments cover Pak-Arab Refinery Company (Parco), Pakistan Refinery Limited (PRL), Attock Refinery Limited (ARL), Cnergyico Pakistan Limited (CPL) and National Refinery Limited (NRL). A senior Petroleum Division official said the government is finalising agreements with all local refineries, with the implementation agreements expected to be signed simultaneously at a high-level ceremony attended by Prime Minister Shehbaz Sharif.
Under the amended policy, refineries are required to sign their implementation agreements within 45 days, compared with the previous deadline of 60 days. The shorter timeline reflects the government’s effort to accelerate refinery upgrades and move planned investments into implementation. The projects are expected to improve fuel quality, increase production of higher-value petroleum products and reduce dependence on furnace oil production.
Parco, Pakistan’s largest refinery and a joint venture between Pakistan and the UAE with a 60:40 shareholding, has finalised a $600 million green fuel project. The company reached its decision after commissioning two studies to assess the most suitable route for upgrading its operations. Parco has informed the government that it intends to sign the required upgradation agreement within the stipulated period.
Rather than proceeding with a standalone bottom-of-barrel project, Parco has opted for the green fuel project under the amended policy. The refinery has already reduced the share of furnace oil in its output from around 20% to 14% through operational measures. Following the first phase of the green fuel project, furnace oil production is expected to decline further to around 10% to 11%, while a second phase is intended to eliminate furnace oil production.
As part of the policy requirements, Parco will also shift completely from Euro-III to Euro-V fuel specifications. Motor gasoline production is projected to increase from approximately 3,678 tonnes per day to 4,023 tonnes per day, while diesel production is also expected to rise following the planned upgrades.
Pakistan Refinery Limited has selected one of the largest upgrade programmes among the country’s refineries. PRL is planning a bottom-of-barrel project estimated at between $1.8 billion and $2 billion. The project is expected to eliminate furnace oil production while significantly changing the refinery’s product mix toward higher-value petroleum products.
The PRL project will also double the refinery’s crude refining capacity from 50,000 barrels per day to 100,000 barrels per day. The planned expansion represents a major increase in the company’s processing capacity and forms a significant component of the broader investment programme being developed for Pakistan’s refining sector.
Attock Refinery Limited has also confirmed its readiness to sign its upgradation agreement. The company’s managing director said ARL remains committed to the refinery modernisation project, which was initially announced in 2023 under the original policy.
ARL’s planned investment of approximately $600 million will include a Continuous Catalytic Reformer, the revamp of its Diesel Hydro Desulphurising Unit, a Kerosene Hydrotreating Unit, additional tankage and utilities, as well as a biofuel facility required under the amended policy. The project is expected to enable ARL to meet Euro-V specifications and increase motor gasoline production by around 25%.
Cnergyico Pakistan Limited, the country’s largest private refinery, is preparing an investment programme of around $1.2 billion. The planned investment will cover green fuel production, bottom-of-barrel processing, refinery capacity expansion and the development of a new Single Point Mooring facility.
CPL currently has crude refining capacity of approximately 156,000 barrels per day and plans to increase this to around 200,000 barrels per day through a three-phase development programme. The first phase, focused on producing Euro-V and Euro-VI petroleum products, is already underway.
The second phase will cover the bottom-of-barrel project, with studies currently in progress, while the third phase will focus on increasing refining capacity and developing the Single Point Mooring facility. The SPM is planned to support the import and export of crude and finished petroleum products.
Under the planned upgrades, CPL is projected to increase gasoline production to approximately 6,500 tonnes per day and diesel production to nearly 11,000 tonnes per day. The refinery is also expected to substantially reduce furnace oil output as its product mix shifts toward higher-value fuels.
National Refinery Limited is considering a hybrid green fuel and bottom-of-barrel project with an estimated investment of between $300 million and $800 million. NRL management has stated that the refinery has already achieved Euro-V high-speed diesel production, while further work is underway to determine the most suitable configuration for upgrading motor spirit and other petroleum products.
The proposed hybrid project is expected to significantly reduce furnace oil production at NRL. The company is also planning to increase its crude refining capacity from 50,000 barrels per day to 70,000 barrels per day. However, the final scope of the upgrade remains under consideration.
Taken together, the investment plans of Parco, PRL, CPL, ARL and NRL represent a potential $4.5 billion to $5 billion transformation of Pakistan’s refining industry. The projects span green fuel production, bottom-of-barrel processing, fuel quality improvements, refinery capacity expansion and supporting infrastructure.
The amended Brownfield Refineries Upgradation Policy has now placed refineries under a 45-day deadline to sign implementation agreements, creating a defined timeframe for the industry to formalise its investment commitments. If the agreements proceed as planned, the combined projects could mark a major expansion and modernisation phase for Pakistan’s domestic refining capacity, while increasing the production of higher-quality fuels and reducing furnace oil output.
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