Govt drives urgent refinery upgrade plan to strengthen energy security

May 11, 2026 (MLN): Progress toward accelerating the operationalization of the Brownfield Upgradation Refinery Policy gained momentum as Federal Minister for Petroleum Ali Pervaiz Malik reviewed the implementation framework with leading oil refinery executives.

The move emphasized the urgency of modernizing Pakistan’s refining infrastructure to strengthen energy security and reduce external supply dependence.

The Petroleum Division highlighted that the refining sector remains a critical strategic asset for ensuring uninterrupted fuel availability, particularly amid heightened regional uncertainty stemming from the US-Iran conflict, which has reinforced the need to enhance domestic refining flexibility and capacity.

During the detailed review, emphasis was placed on the timely upgradation of existing refineries to improve efficiency, expand production capability, and enable the production of Euro-V compliant fuels.

The Minister noted that aligning local output with international fuel standards would support cleaner environmental outcomes, improved engine performance, and reduced emissions.

It was also observed that despite the formal issuance of refining policies in 2023, implementation progress has remained limited due to unresolved structural and regulatory bottlenecks.

Stakeholders stressed that addressing these constraints is essential to unlock investment and advance refinery modernization plans.

A key concern identified during the deliberations was the exemption of sales tax on petroleum products, which industry participants described as a major factor affecting the financial viability of upgradation projects.

The Minister directed that a comprehensive proposal be prepared to address these issues and submitted to the relevant forum ahead of the upcoming budget cycle to ensure timely policy execution.

Refinery CEOs and Managing Directors reiterated their confidence in the Petroleum Division’s efforts while outlining practical challenges and suggesting measures for resolution.

The upgradation policy framework and agreement template were reviewed in detail to ensure effective and timely operationalization.

The Federal Minister reaffirmed that refinery modernization remains a national priority, stressing that strengthening domestic refining capacity is vital for long-term energy security and resilience against global supply disruptions.

The session was attended by senior officials including the Secretary Petroleum, Additional Secretary (Policy), Director General (Oil), and other key representatives of the Petroleum Division.

It also included chief executives of major refineries such as Pakistan Refinery Limited, Pak-Arab Refinery Company (PARCO), Attock Refinery Limited, Cnergyico Pk Limited, and National Refinery Limited.

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