October 1, 2018 (MLN): Pakistan and Saudi Arabia are likely to sign four Memoranda of Understanding (MoUs) regarding oil and mineral sector investment and trade cooperation, at the end of a four-day visit of Saudi delegation that arrived in Pakistan on Sunday, 30th September.
Led by the Minister for Energy, Industry and Mineral Resources, the visiting delegation would also have members from the Saudi national oil firm, Aramco.
Besides authorities of various ministries, state-run Pakistan State Oil (PSO) would be the only Pakistani firm to be part of a direct dialogue.
The maneuver would extend the Chinese Belt and Road Initiative (BRI) from Gwadar to Africa through Oman and Riyadh.
It will also facilitate Islamabad in getting supply of petroleum products and crude oil on deferred payments.
As a part of the MoUs, Riyadh will diversify its trade routes by dredging into the establishment of an oil refinery at Gwadar, invest in a copper and gold project in Balochistan’s Reko Diq and LNG-based power projects in Punjab.
It is currently considering two options to link Gwadar with Muscat and Oman, that is, either 40 km bridge or a tunnel, at the aperture of Strait of Hormuz on one side and connect its industrial city of Jazan with Eritrea’s Massawa region through a 440 km tunnel across the Red Sea.
The meetings would be held on Monday between the officials of Saudi and Pakistani companies under the aegis of the ministries of energy & mineral resources and industries & production for an 110,000 barrel per day (BPD) refinery at Gwadar and investment in copper mines of Reko Diq and phosphate supply.
The two sides would also discuss the supply of refined products and crude oil imports on deferred payments followed by another session for proposed privatization of two LNG-based power plants set up by federal funding in Punjab the same day.
The two sides would then hold final discussions on proposed MoUs on the Gwadar refinery, Reko Diq, two power plants and oil supplies, both refined and crude on Wednesday.
According to a finance ministry official, the projects would take time to materialize. However, the investments flowing into Pakistan could support declining foreign exchange reserves.
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