ISLAMABAD: Saudi Arabia has agreed in principle to invest in a new state-of-the-art oil refinery in Pakistan, it was announced Thursday. The governments of both countries will reportedly sign a formal agreement by the end of this month or early in November.

“It is good news for Pakistanis that Saudi Arabia is going to invest billions of dollars in Pakistan’s oil and gas sector,” Information Minister Fawad Chaudhry said while addressing a press conference along with the Minister for Petroleum Ghulam Sarwar Khan.
“Saudi Arabia has declared its interest in immediately investing in a new oil refinery in Pakistan, and our cabinet today approved a summary for it,” Khan said.
In what would essentially be a government-to-government agreement, Khan said that state-owned Pakistan State Oil (PSO) will partner with Saudi state oil giant Aramco for the project.
“The Saudi energy minister will visit Pakistan by the end of this month or the beginning of next month to sign a memorandum of understanding for the refinery,” Khan announced.
The minister said that the refinery will be established in Gwadar, a deep-sea port in Baluchistan province, and details related to its cost and capacity have yet to be finalized.
A Saudi delegation led by Adviser on Energy Ahmad Hamed Al-Ghamdi is currently visiting Pakistan to explore different areas for investment.
The petroleum minister said that Pakistan has offered at least more four projects to Saudi Arabia for investment, including two multipurpose pipelines and exploration of oil and gas reserves in the country.
“We have asked Saudi Arabia to invest in the drilling sector too, because they have rich experience of it,” he said, adding that further talks on that matter would be held with Saudi Arabia’s energy minister.
Khan said that his government has also invited the United Arab Emirates to invest in Pakistan and claimed that the Emirates have also shown interest in investing in an oil refinery.
“We need at least four to five new oil refineries in our country to fulfill our demand,” he said, adding that Pakistan is ready to welcome other countries’ investments, including Russia and China.
The minister said that he has not talked to the visiting Saudi delegation about acquisition of petroleum products from the Kingdom on deferred payment.
“The Saudis have welcomed all our suggestions,” he said. “They have even said that if Pakistan moves one step, they are willing to take two steps.”
He also dispelled the impression of any Chinese concern over Saudi investment in Pakistan. “There is no truth in this news,” he said.
The development regarding Saudi investment in the oil refinery in Pakistan comes weeks after a maiden visit of Prime Minister Imran Khan to Saudi Arabia where he held talks with King Salman bin Abdul Aziz Al Saud and Crown Prince Mohammad Bin Salman, among others.
“Prime Minister was accorded a warm welcome in Saudi Arabia,” Petroleum Minister said, “Saudis had shown a keen interest in investment in Pakistan during the high-level meetings there.”