REFINING AND OIL

MARKETING IN
PAKISTAN

EJAZ H. RANDHAWA
Senior Manager (Technical Services)
Attock Refinery Limited
Pakistan

September 11, 2007

¾INTRODUCTION
• WORLD REFINING OVERVIEW

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 2
 OIL- A Major Key Player

Source: BP Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 3
 Demand Steadily Increasing

140
118
Million barrels per day

120 104 111

98
100 92
80
80
60
40
20
0
2003 2010 2015 2020 2025 2030
Projected Years

Electricity Transportation Industrial Commercial Residential

Source: Energy Information Administration EIA

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 4
 Strong demand will continue driving
capacity utilization

Source: BP Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 5
 Planned Capacities by 2010-Major
Investment planned (MBpd)
Presently 2,900

Severe of which: of which:

Presently 2,500
CDU CCR Secondary HDC Dist. HDT HDS Resid HDS
South Asia 5,165 559 1,641 484 1,525 250 28
India 3,939 435 1,481 418 1,337 232 28
Pakistan 752 84 100 66 91 - -
Bangladesh 326 18 38 - 64 18 -
Sri Lanka 148 22 22 - 33 - -
Presently 282
Source: Asia Pacific Energy Consulting
Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 6
 China & Middle East Expansions (by 2010) MBPD
THC/ Cat. Alky/ Dist. Resid
Company CDU VDU Coking HDC R/FCC Isom BTX Lubes Asphalt
VSB Reform Poly HDT Desulf.
Wepec - - - 30 - - - - - - 40 - - -
PetroChina 744 178 23 135 6 18 57 2 - - 256 - 1.0 -
Sinopec 1,430 282 70 111 103 - 43 1 - - 419 119 8.0 -
GS Caltex - - - - - - 35 - - - - - - -
Jiangsu Lingguang Group 30 - - - - - - - - - - - - -
Sinopec
158 65 - 32 28 - 20 2 - - 60 25 - -
/ExxonMobil/ Aramco
CNOOC 236 98 74 73 24 - 30 3 - - 115 40 - -
Sinopec/
156 98 - 54 - 30 23 - 4 - 45 - - -
Hainan Provincial Co.
Yangchang Oil
58 - - - - - - - - - - - - -
Administration
GRAND TOTAL 2,812 721 167 435 161 48 208 8 4 - 935 184 9.0 -

Middle East CDU VDU Coking HDC R/FCC THC/VSB Cat. Alky/Poly Isom BTX MTBE Naphtha Distillate GO Resid Lubes Asphalt
Reform HDT HDT Desulf. Desulf.
Mideast Total 1,429 195 - 116 271 65 278 12 108 14 1.5 391 468 71 106 4.0 2.0

Source: Asia Pacific Energy Consulting Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 7
1. REGIONAL ENERGY OVERVIEW

2. PAKISTAN ENERGY SCENARIO

3. REFINING SECTOR
4. CHALLENGES
5. OPPORTUNITIES

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 8
 Per Capita Consumption Increasing
Per Capita Energy Consumption - Pakistan
Year
(TOE/capita)

2004-05 Actual 0.37

2009-10 0.42

2014-15 0.52

2019-20 0.64

Per Capita Energy Consumption

Countries
(TOE/capita)

Below 0.5 Nepal, Uzbekistan, Kenya, Bangladesh, India

0.5 – 1.0 Indonesia, China, Sri Lanka, Philippines, Algeria

1.0 –2.0 Thailand, Malaysia, Brazil, Turkey, Egypt

2.0 – 6.0 U.S.A, U.K, France, Saudi Arabia, Singapore

Source: Pakistan Energy Outlook by Petroleum Institute of Pakistan
Pakistan (PIP)
Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 9
 Increasing Gap
Pakistan: Energy/Supply Pattern

130

110
Demand
(Million TOEs)

90

70
Supply
50

30

10

Energy Deficit
Year Total Energy Demand Local Energy Supply
Million TOE
2004-05 Actual 54.9 39.6 (15.3)
2009-10 71.0 47.2 (23.9)
2014-15 95.6 47.0 (48.6)
2019-20 128.7 in Pakistan-Carbon Credits Potential
Refining & Marketing 41.9 in Oil & Gas (86.8)
Source: Pakistan Energy Outlook by PIP Sector 10
 Energy Imports expected

Coal/Hydel Total Demand

Year Natural Gas Oil Products
/Nuclear etc (million TOE)

2004-05 Actual 28.0 (51%) 15.9 (29%) 11.0 (20%) 54.9

2009-10 30.7 (43%) 26.5 (37%) 13.8 (20%) 71.0

2014-15 43.3 (45%) 33.4 (35%) 18.9 (20%) 95.6

2019-20 55.0 (43%) 43.9 (34%) 29.8 (23%) 128.7

DEFICIT IMPORTS (Million TOE)

Natural Gas Petroleum Products
Year Coal Imports Total Imports
Imports Imports

2004-05 Actual - 13.1 2.2 15.3

2009-10 - 21.2 2.6 23.9

2014-15 16.4 28.2 4.4 48.6

2019-20 41.0 38.7 7.1 86.8

Refining
Source: Pakistan Energy Outlook by PIP & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 11
1. REGIONAL ENERGY OVERVIEW
2. PAKISTAN ENERGY SCENARIO

3. REFINING SECTOR
4. CHALLENGES
5. OPPORTUNITIES

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 12
 REFINERIES-Limited Capacity
Existing Refineries Barrels per Stream Day Million Tons per Annum*
(BPSD)

Pak-Arab Refinery 100,000 4.47

Limited (PARCO)
National Refinery Limited 62,000 2.77
(NRL)
Pakistan Refinery Limited 50,000 2.24
(PRL)
Attock Refinery Limited 40,000 1.79
(ARL)
BOSICOR Pakistan 30,000 1.34
Limited (BPL)
TOTAL 282,000 12.61

* Tons per annum based on 340 Stream days and 7.6 Bbl/Ton factor
Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 13
 Mostly Hydroskimming

Refinery Configuration

PARCO CCR/DieselMax/Visbreaker

NRL Hydroskimming/Lubes

PRL Hydroskimming

ARL Hydroskimming

BOSICOR Hydroskimming

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 14
 Operating Throughputs reaching
nameplate
TON
‘000’
14,000
Nameplate Capacity
13,000
12,000
11,000
10,000
9,000
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
-
1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06

ARL PRL NRL PARCO Bosicor

Source: OCAC/Pakistan Energy Book
Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 15
 Planned Projects

Planned Refineries Barrels per Stream Day Million Tons per Annum*
(BPSD)

INDUS REFINERY 100,000 4.47

BOSICOR (New) 120,000 5.37

COASTAL REFINERY 250,000 11.18

TOTAL 470,000 21.02

* Tons per annum based on 340 Stream days and 7.6 Bbl/Ton factor
Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 16
Location of Refineries

ARL
Dhodak

Parco

Bosicor
New NRL
Bosicor PRL

Indus Planned
Coastal Existing

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 17
 Projects in Initial Planning Stage

Planned Refineries Barrels per Stream Day Million Tons per Annum*
(BPSD)

GWADAR REFINERY 250,000 11.18

AT GWADER PORT
PAK-KUWAIT 100,000 4.47
REFINERY AT PORT
QASIM KARACHI
TOTAL 350,000 15.65

* Tons per annum based on 340 Stream days and 7.6 Bbl/Ton factor
Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 18
Upgradation Plans at a glance

¾ All existing Refineries working on producing Cleaner Fuels

Refinery Plan

PARCO Diesel Hydrodesulfurization (HDS)

NRL HDS

PRL Vacuum unit/ HDS/ Thermal Cracker

ARL Isomerization/ HDS

Bosicor Isomerization

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 19
OIL MARKETING COMPANIES
(OMCs)
¾ MAJOR OMCs
• Pakistan State Oil Company Limited
• Shell Pakistan Limited
• Attock Petroleum Limited
• Caltex Oil (Pakistan) Limited
• Total Pakistan Private Limited
• Admore Gas (Pvt) Limited
¾ OTHERS
• ASKAR Oil Services (Pvt) Limited
• Hascombe Storage (Private) Limited
• Overseas Oil Trading Company (Pvt) Limited
Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 20
 STORAGES: Refineries & OMCs
(Pakistan Oil Report 2004-
2004-5)

Crude/Product MTons (July 01, 2006)

Crude 844,400
Naphtha 105,584
LPG 2,770
100/LL 1,200
JP-1 76,216
JP-8 21,101
Premium Motor Gasoline 92,138
HOBC 3,404
Kerosene 83,706
High Speed Diesel 1,017,465
Light Diesel Oil 28,927
Low Sulfur Fuel Oil 35,046
High Sulfur Fuel Oil 496,711

Total 2,808,668

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 21
 Location of OMC’s Storages
China
CTL

JG T
FAQ

TJB
Islamabad
CKL/SIH
Afghanistan KHT

SRNG CPI
M AT
Lahore
MCH
KND BKR SRQ
HBD
Multan
KJM
GAT/FBD
QTA MHK

Quetta SSH SWL

India
VHR

Iran
SKP

KZD SNG
SUK White Oil
DLP Pipeline
PSI

HDR

Arabian Sea KMR

Karachi
Post WOP New Freight Pool Model
December 2004
Source: Oil Companies Advisory Committee OCAC
Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 22
MAJOR EXISTING OIL PIPELINES

Company (Pipeline) Service Dia (Inches) Km

PARCO Crude 16 864

(Karachi-Mahmood
Kot)

PAPCO (Port Qasim- HSD 20 817

Mahmood Kot)

*Proposed
Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 23
MAJOR PROPOSED OIL PIPELINES

Company (Pipeline) Service Dia (Inches) Km

ARL PMG/Kero/ 16/12 470

HSD/Jet fuels
(Machike-Morgah-Taru
Jabba)
PARCO Products - 190
(Faisalabad-Kharian)
PARCO (Faisalabad- Products - 90
Sahiwal)
PARCO (Mahmoodkot- Products - 430
Peshawar)

BOSICOR(Refinery- Crude/Products - 15
SPM)
Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 24
 Main Oil Pipeline Routes
1. Most efficient & reliable
Transportation mode
2. Eliminates heavy traffic on
congested roads
3. Reduced accidents
4. Reduced road infrastructure
maintenance cost
5. Reduced environmental pollution
6. Ensures product quality (No
adulteration)

ANPL: Attock Northern Pipelines Ltd.

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 25
25
1. REGIONAL ENERGY OVERVIEW
2. PAKISTAN ENERGY SCENARIO
3. OIL PRODUCTION IN PAKISTAN
4. REFINING SECTOR

5. CHALLENGES
6. OPPORTUNITIES

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 26
 Big Jump in Car Sales But all CNG-
Pressure on PMG Sales

Car Production and Sales

200,000

150,000

100,000 Production
Sales
50,000

-
2003 - 04 2004 - 05 2005 - 06 2006-
2007(~upto
June 2007)

2003 - 04 2004 - 05 2005 - 06 2006-2007(~upto June 2007)

Production 98,461 126,403 160,642 160,496
Sales 96,620 127,309 155,514 165,268

Source: PAMA

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 27
 Naphtha Exports at a loss

REFINERY EXPORT
Tons/Annum

PARCO -

NRL 315,000

PRL 200,000

ARL 212,000

BOSICOR 37,000

Dhodak 83,000

Total Country Exports Potential 847,000

Source: OCAC
Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas
Sector 28
Sulfur Main concern-Investments Required
HSD
Current PSI Specifications

Specification Value Limit

Sulfur 1 wt% Max

Coming Specifications (EURO II)

Specification Value Limit

Sulfur 0.05 wt% (Euro II) Max

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 29
OPPORTUNITIES FOR CDM

1. Investments in Refining and Petrochemical

2. Power Sector
3. Gwadar Port

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 30
 Upgradation
Upgradation to
to Improve
Improve Margins
Margins and
and
Specifications -lead to
Specifications-lead to CO2
CO2 production
production
LPG Treat
Isom

C
R Reformer
U Naphtha
Naph.
D
Cracker
E HDT CCR
Kerosene Naph.
D
I Merox Splitter
S
T
I
L
A Diesel
T
I
O
N
Diesel
U HDT
N
I
T

Vac HYDRO-
Twr CRACKER
Delayed
Power Generation
Coker
VDU
 Khunjrab Pass

Major Infrastructure Build Up-CO2 Tarbela Dam CHINA

Motorways, Trucking System

5)
-3
JALALABAD
KASHMIR

(N
Peshawar
Torkham M -1
Railways, Ports A N er a
Islamabad DISPUTED

ST

l
da
sh Rawalpindi TERRITORY
I ow

ab
Digital / Fiber Connectivity AN KOHAT N

an
ss

M-2
Mangla Dam

GH

Ha

n
ia
Ri us
Energy, Education

ar
(N - 55)
F

r
d
Chenab

ve
ab

Kh
In
A lum
e r
D.I. Khan Jh ive -3
h en r Bridge
C ive
R
0) R M
HUBS CORRIDORS
Chaman Qila
-5 Faisala Lahor
Saifullah (N
Shorkotbad - avei Wahgah
Quetta M R er
(N - 70) 4Riv 5) Okara
D.G. -
Taftan (N
Lakpass Khan M-5 Multa
Mian
n ej
Nok (N - 40) Channu
Sutl
Kundi i ver
BahawR
(N - 25)

(N
IRAN M-6
alpur

-
65)
Rahim Yar
Sukkur
Khan
-8 Roh
M Ratodero
ri MMTJPP Pipeline
)
Turba -5 Connecting Highways
(N
t

-7 Motorways
M
Gwadar Hala National Highways
M-9 Hyderabad
Hub
Karachi
Kotri
Major new Industrial
Estates / Clusters will
ARABIAN SEA be set up along the
Source: Planning Commission
new Trade Corridors
NEW HUBS FOR CO2 EMMISSIONS THAT
CAN BE TAPPED

¾ US $ 12.5 Billion Oil-Petrochemical City Planned

• Oil Refinery
• Petrochemicals
• Storages/Terminals
¾ Feasibility of the proposal in progress
¾ 12,500 Acres of land being acquired

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 33
CDM Potential in Petroleum Refineries

¾ Major areas for energy efficiency improvement are utilities (30%), fired
heaters (20%), process optimization (15%), heat exchangers (15%),
motor and motor applications (10%), and other areas (10%)

¾ Hydrogen gas production from Platformer off gas instead of Naphtha

¾ Waste Heat Recovery and using the recovered heat for heating oil

¾ Crude Preheat Train optimization through modification of heat

exchangers network

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 34
CDM Potential in Petroleum Refineries

¾ Gas flaring reduction which is the main source of GHG emissions from
oil and gas industry

¾ Reducing heat loss into atmosphere along with the flue gases by utilizing
it for preheating combustion air of heaters/boilers

¾ Steam generation through waste heat recovery from processes,

cogeneration, and boilers

¾ Installation of CO2 recovery plant and utilize for urea production

Refining & Marketing in Pakistan-Carbon Credits Potential in Oil & Gas

Sector 35
THANK-YOU