PRL to produce IMO grade fuel oil

Muhammad Afzaal

Pakistan Refinery Limited (PRL) is going to become the first company to produce IMO grade fuel oil, very low sulphur (VLSFO) fuel oil to export it at a higher price.

‘This will change the company financials significantly starting June this year, an official said. By the end of the current financial year, the Company is expected to become the first Refinery in Pakistan to produce Very Low Sulphur or IMO-2020 standard furnace Oil which is a premium product that fetches a much higher price than High Sulphur Furnace Oil currently produced.

https://newztodays.com/around-30-nations-to-walk-away-imos-meet-up/

This is a big achievement for our company. We will achieve Euro 2 diesel with the installation of DHDS. This was installed by ARL, NRL, and Parco at the cost of an average of $300 million. We will be the first company to produce IMO grade fuel oil that is very low sulphur (VLSFO) fuel oil-exporting it at a high price, an official said adding that this will change the company financials significantly starting June this year. All this is being done by changing operational strategy and changing the crude recipe.

As mentioned in the Directors’ Review on the half-yearly results of the Company for the period ended December 31, 2019, to ensure operational and financial sustainability, the Company in the light of a new operational strategy has undertaken certain non-CAPEX options, implementation of which is expected to have a positive impact on the Company.

As a part of the new operational strategy, the Company has considered a new crude oil recipe which is expected to positively change the product slate and also make the Refinery compliant with regulatory requirements. We are pleased to announce that this change of crude oil recipe, coupled with other initiatives already undertaken, is expected to contribute positively.

The Company is now producing Motor Gasoline (Petrol) of 92 RON thus saving the RON differential penalty. The Company is also producing MS 95/97 RON, generating additional revenue.

By the end of the current financial year, the Company is expected to produce EUR0 I standard High. Speed Diesel (HSD) thus becoming compliant with regulatory requirements and saving price differential and penalty, currently being paid on the non-compliant HSD. Price differential and the penalty paid in 2018-19 amounted to Rs. 1.15 billion.

Similarly, by the end of the current financial year, the Company is expected to become the first Refinery in Pakistan to produce Very Low Sulphur or IMO-2020 standard Furnace Oil which is a premium product that fetches a much higher price than High Sulphur Furnace Oil currently produced.

These initiatives will improve future refinery margins and help the Company in achieving regulatory compliance. The above initiatives are in addition to the Refinery Upgradation Project and the short to medium-term CAPEX projects announced earlier.