In Inte tegra grated ted Ref efin inery ery an and P d Pet - - PowerPoint PPT Presentation

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In Inte tegra grated ted Ref efin inery ery an and P d Pet etroc rochemical hemical Com

• mpl

plex ex

Pakistan stan Economi

• mic

c Forum um

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Why y an integr egrate ated d petrol roleum eum comple lex in Pakista istan? n?

Focus cus needed ded to subst bstitut ute e refined ned import ports to crude de import ports

Crude - $4Bn Refined: $7Bn Growing Population and emerging middle class Booming automotive industry Growing Economy

~$ 11Bn

Petroleum Imports in FY18 Pakistan's biggest Import by category Lack ck of an integrat egrated ed refinery nery

THE OPPORTUNITY TO MAKE AN IMPACT

~$ 2.3Bn

Thermo- plastics Imports in FY18

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• Fuel oil consumption expected to go down due to change in the power generation fuel mix
• LPG demand is expected to continue growing, driven by RCA* sector
• Pakistan can make value added products with the excess Naphtha

Growin ing g defic icit it of oil l produc ucts ts provide e an opport

• rtunity

unity for investme tment nt in a world d scale ale refine inery ry

Source: Wood Mackenzie Product Markets Service ; Wood Mackenzie Analysis.

Product

• duct balanc

ances es in kbpd pd LPG Naphtha htha Gasol soline ne Jet/Keros erosen ene Diesel el/Gaso asoil Fuel Oil

(54) (76) (111) (36) (58) (93) (26) (48) (83) 2035 2027 2022 22 22 22 47 47 47 60 60 60 2022 2027 2035 (149) (202) (79) (133) (228) (42) (96) (191) 2027 2035 2022 (4) (7) (13) 41 38 32 61 56 2027 2035 2022 (106) (129) (161) (14) (37) (69) 35 12 (21) 2035 2027 2022 (49) (37) (27) (44) (32) (22) (42) (29) (20) 2035 2027 2022 460 kb/d 300 kb/d No refinery

*RCA: Residential, Commercial & Agriculture

Sector-wise demand

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1 2 3 4 5 1 2 3 4 5 Histo tori rica cal l CAGR R (2010 to 2017) ADN ABS ABS SBR SBR PBR PBR Cumene AA AA Oxo xo ACN PO PO PP PP LAO EB EB Vinyls yls MEG PE PE Bubble size represent size of the market

Butadiene Deivative Propylene Derivative Ethylene Derivative

Import Value in USD Mn FY18 Polyethelyne 705 Polypropylene 615 Polyacetals 153 Polymers of vinyl chloride 77 Polymers of vinyl acetate 36 Others 725 Total Plastic Materials 2,311

Upsid ide e for olefin fins s demand nd – Pakista istan n per capita ita plas astic tic consu nsumpt mption n of 7kgs gs vs Gl Global bal average of 45kgs gs

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Pakis istan tan Curren entl tly does not have a Petro roche hemic ical al Complex ex - Opportuni rtunity ty t to Set Up an Integ tegrated rated Crack cker er to me meet dome mesti tic c needs

117 120 128 137 160 185 211 238 263 290 319 349 381 54 74 85 76 87 99 110 122 133 144 156 168 181 69 122 147 161 187 217 247 279 308 339 373 408 445 216 268 312 422 491 570 649 732 808 891 979 1,071 1,169 243 257 248 319 388 439 490 542 588 637 683 725 768

• 500

1,000 1,500 2,000 2,500 3,000 2010 2013 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 HDPE LDPE LLDPE PP MEG

Pakistan’s growing demand for Petchem derivatives supports the establishment of a cracker complex

Demand in kt kt

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A cracker cker will ll add value to excess s Naphtha tha availabl able e in the country ntry

100 200 300 400 500 600 700 800 900 1000

USD 466

Naphtha tha price e per ton (WoodMa dMac)

Petchem complex

100 200 300 400 500 600 700 800 900 1000

USD 1,000

Olefin fins s price e per ton (WoodMa dMac)

According to Oil Companies Advisory Council (OCAC), Pakistan exported 470k Tons of Naphtha in 2017

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Import t Bill ll savings gs throug

• ugh an integr

egrate ated d refiner nery

Import bill without the Project Import bill with the Project Saving on Import Bill

USD 13.3 BN USD 21.4 BN

A world scale complex will lead to economic activity & job creation coupled with securing the country’s requirements of petroleum products and

derivatives

(USD 2.7 BN) USD 18.7 BN

2025 2018

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Suppor port t needed ded for an an an integr egrate ated d comple lex

3,000 acres coastal land with related infrastructure and pipeline support

Deep Conversion Refinery: Maintain 20 year tax holiday Petchem Complex: Allow 20 year tax holiday as provided for deep conversion refineries Feedstock: Waive import duty on crude oil / Naphtha import Refined Oil: Maintain the current import duty structure Petchem Derivatives: Minimum 10% duty Machinery: Waive import taxes on import of machinery Facilitate a consortium composing of a feedstock supplier(s) preferably Middle Eastern players and potential Chinese partner to leverage CPEC connectivity

1 2 3 4

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Integr egrate ated d Petroleum

• leum Comple

lex – The Right ht Time

With h huge relian ance ce on import rts s to meet t the growing petrol

• leum

um demand nd in the country try, this s is the right t time to set up a state te-of

• f-the

the-art rt integra grated ted petrol

• leum

um comple lex x in Pakistan stan The estima imate ted d invest stme ment nt for a suita tabl ble scale e comple lex x would be:

• Refine

nery ry: USD 6 – 7 BN

• Petrochemical

rochemical Comple lex: x: USD 4.5 - 5 BN

• Integ

egrate rated d Comple lex: x: USD 10 – 12 BN

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Thank You