KARACHI: The Competition Commission of Pakistan (CCP) this week approved Saudi oil giant Aramco’s decision to acquire a 40 percent stake in local company Gas & Oil Pakistan Ltd, officially marking the Saudi company’s entry into Pakistan’s fuels retail market. 

Aramco and Gas signed the agreement to acquire 40 percent stake in Gas and Oil Pakistan Ltd., a licensed oil marketing company, in December 2023. Gas and Oil Pakistan Ltd. is involved in the procurement, storage, sale, and marketing of petroleum products and lubricants. It is also one of Pakistan’s largest retail and storage companies.

Aramco is a global integrated energy and chemicals company that produces approximately one in every eight barrels of the world’s oil supply and develops cutting-edge energy technologies. Aramco Asia Singapore Pte. Ltd., a Singaporean company wholly owned by Saudi Aramco, filed the pre-merger application with the CCP. It specializes in sales, marketing, procurement, logistics, and related services, with a focus on prospecting, exploring, drilling, extracting, processing, manufacturing, refining, and marketing hydrocarbon substances.

“The Competition Commission of Pakistan (CCP) approved a 40 percent equity stake acquisition in Gas & Oil Pakistan Ltd. (GO) by Aramco, a global leader in integrated energy and chemicals,” the CCP said in a statement on Monday. “This transaction marks Aramco’s first entry into Pakistan’s fuels retail market, underscoring its confidence in the country’s economic potential and its commitment to its growth.”

The CCP said it had authorized the merger after determining that the acquisition would not result in the acquirers’ “dominance” in the relevant market post-transaction.

“Aramco’s acquisition indicates a significant milestone in Pakistan’s energy sector, bringing advanced expertise and technology to the fuels retail market,” it said. “This development is expected to boost competition, elevate service standards, and provide consumers with a broader range of high-quality products.”

The CCP said the acquisition would help bring much-needed foreign direct investment in Pakistan’s energy sector, contributing to economic growth and development of the country. 

In February 2019, Pakistan and Saudi Arabia inked investment deals totaling $21 billion during the visit of Saudi Crown Prince Mohammed Bin Salman to Islamabad. The agreements included about $10 billion for an Aramco oil refinery and $1 billion for a petrochemical complex at the strategic Gwadar Port in Balochistan.

Pakistan’s Prime Minister Shehbaz Sharif, who is in Saudi Arabia for a special meeting of the World Economic Forum, held meetings this week with Saudi Arabia’s ministers of energy, economy and planning, and environment, according to his office.

In a meeting with Saudi Energy Minister Prince Abdulaziz bin Salman on Monday evening, Sharif highlighted initiatives undertaken by Pakistan to facilitate investment in the energy sector. The Saudi side showed keen interest in Pakistan’s energy projects highlighted by Sharif, the Prime Minister’s Office (PMO) said. 

The proposed projects included building new and improving existing energy infrastructure, increasing focus on renewable energy, and bringing efficiency across entire energy ecosystem in Pakistan, according to the statement. 

Pakistan and Saudi Arabia enjoy strong trade, defense and cultural ties. The Kingdom is home to over 2.7 million Pakistani expatriates and serves as the top source of remittances to the cash-strapped South Asian country.

Both countries have been closely working to increase bilateral trade and investment deals, and the Kingdom recently reaffirmed its commitment to expedite an investment package worth $5 billion.

ISLAMABAD: Prime Minister Shehbaz Sharif met Saudi Crown Prince Mohammed bin Salman on Monday to discuss matters of mutual interest and regional developments, thanking him for a “comprehensive” program presented by Saudi ministers regarding investment in Pakistan, Sharif’s office said on Monday. 

Sharif has held meetings with Saudi officials and ministers since he arrived in Riyadh on Saturday to attend a two-day World Economic Forum (WEF) special meeting on energy, collaboration, and health. His visit to the Kingdom follows Saudi Foreign Minister Prince Faisal bin Farhan’s trip to Pakistan in mid-April with a high-level delegation. The Saudi foreign minister’s visit was aimed at strengthening bilateral economic cooperation and pushing forward previously agreed investment deals. Pakistan has said it pitched investment projects worth $30 billion to Riyadh during Prince Faisal’s visit.

In videos and pictures shared by Sharif’s office, the two leaders can be seen interacting with each other in the presence of their teams. Sharif thanked the Saudi crown prince for sending the high-level delegation to Pakistan and issuing directions for more Saudi delegations to visit the country “to promote investment,” the Prime Minister’s Office (PMO) said. 

“The Prime Minister expressed gratitude to the Crown Prince for the hospitality during his visit to Saudi Arabia and for a comprehensive program presented by Saudi Ministers regarding investment in Pakistan,” the PMO said. 

The statement added that both leaders agreed to further promote cooperation in different sectors as they discussed areas of mutual interest and expressed satisfaction over their meeting in Makkah earlier this month. 

“The situation in Gaza was also discussed in the meeting,” the PMO said. “The Prime Minister reiterated the invitation to the Saudi Crown Prince to visit Pakistan.”

Pakistan and Saudi Arabia enjoy strong trade, defense and cultural ties. The Kingdom is home to over 2.7 million Pakistani expatriates and serves as the top source of remittances to the cash-strapped South Asian country.

Both Pakistan and Saudi Arabia have been closely working to increase bilateral trade and investment deals, and the Kingdom recently reaffirmed its commitment to expedite an investment package worth $5 billion.

Pakistan set up the Special Investment Facilitation Council (SIFC), a hybrid civil-military body, in June 2023 to attract international investments mainly from Gulf countries. The SIFC has identified mining, agriculture, energy and information technology as some of the key sectors where it hopes to attract foreign funding. 

Cash-strapped Pakistan desperately needs to shore up its foreign reserves and signal to the International Monetary Fund (IMF) that it can continue to meet requirements for foreign financing that has been a key demand in previous bailout packages. 

Saudi Arabia has often come to Pakistan’s aid in the past, regularly providing it oil on deferred payments and offering direct financial support to help stabilize its economy and shore up its forex reserves.