Pakistan State Oil (PSO) has opted to divest a 30 percent stake in Pakistan Refinery Limited (PRL) through a $1.5 billion investment deal with a Chinese company.
“PRL, in which PSO has a 63.6 percent ownership, has entered into an agreement with China’s United Energy Group (UEG).
With the latter committing a $1.5 billion investment aimed at tripling PRL’s production capacity,” as reported by Express Tribune.
The memorandum of understanding (MoU) between PRL and UEG was formalized in China on October 18, 2023.
The agreement outlines the intention to forge a strategic cooperative relationship, particularly focusing on shared interests in Pakistan’s energy sector.
The parties commit to sincere negotiations to explore potential avenues of collaboration and partnership, emphasizing UEG’s role as a strategic investor with equity participation for the enhancement of the refinery.
Notably, PRL has also finalized a commercial crude purchase arrangement with Russia, with the initial shipment scheduled for this month.
This agreement stems from the discussions at the Pakistan-Russia Inter-governmental Commission meeting in January 2023, where PRL was designated as the procuring organization.
“In line with the terms agreed upon, PRL will procure crude oil from Russia on commercial terms without breaching Pakistan’s international commitments or the overarching international framework governing such transactions.”