ARL on verge of shutdown resulting from continues slide in petrol, HSD

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ISLAMABAD-Attock Refinery Restricted (ARL) has lodged a criticism with caretaker petroleum minister in opposition to Oil and Fuel Regulatory Authority (OGRA) for its failure to guard the curiosity of the native refinery in opposition to the import gasoline, which has resulted in a decline of as much as 43 % within the refinery sale in the course of the earlier 4 months.
Attock Refinery Restricted is on the verge of shutdown owing to continues slide in Petrol and Excessive Pace Diesel (HSD) sale, which has declined by as much as 43 % in the course of the earlier 4 months, stated a letter. The sale of petrol has declined by as much as 43 % whereas excessive pace diesel by 25.45 % throughout final 4 months i.e. August to November, stated two separate letters written by ARL to the caretaker Minister for Power and Oil and Fuel Regulatory Authority. In accordance the petroleum sector consultants, there are a number of causes for the sale decline which incorporates the upper price of regionally procured crude oil which makes ARL refined product costs much less aggressive vis-à-vis imported refined merchandise or merchandise of the opposite refineries. Equally, shopper’s notion for high quality of the petroleum merchandise and gauge of petrol pumps of assorted OMCs is one other issue which impacts the sale of the assorted OMCs and refineries. The sale of illegally procured petroleum merchandise additionally performs a job within the decline of the general sale of assorted refineries/OMCs.
In a letter addressed to caretaker Power Minister Muhammad Ali, ARL stated that the refinery processes 100 % native indigenous crude oil from Khyber Pakhtunkhwa and Potohar areas. Because of falling output from these fields Attock Refinery Restricted at present operates at 77-80 % capability. ARL has been requesting Petroleum Division, Ministry of Power to allocate 5,000 barrels per day of condensate crude oil from fields in Sindh, which is at present being exported, however the proposal is but to be carried out despite its approval by ECC six months in the past, stated the letter.
It’s more and more turning into troublesome for ARL to function even at decrease throughput of 80 % resulting from low upliftment of its merchandise primarily petrol and diesel by Oil Advertising Corporations (OMCs). The gross sales figures of final 4 months present that solely 38 % of petrol and 47 % of diesel offered by OMCs in ARL’s gross sales envelope was uplifted from ARL and the remaining was introduced in from native or imported sources inflicting not solely overseas change loss but additionally greater Inland Freight Equalisation Margins (IFEM) which is added up in shoppers gross sales costs. The decrease upliftment of merchandise additionally regularly forces ARL to additional scale back throughput or shutdown a number of of its crops. The scenario has as soon as once more reached an alarming level the place ARL will probably be pressured to close down if no corrective measures are taken.
Complaining concerning the function of OGRA, the letter stated that as per Pakistan Oil Guidelines 2016, 35 (g) it’s Oil and Fuel Regulatory Authority (OGRA)’s duty to make sure that OMCs prioritise upliftment from native refineries over imports however despite a lot of submissions and reminders, OGRA has did not take any tangible corrective motion. ARL has requested the minister intervention to allow ARL to function at its optimum capability. In a separate letter written to OGRA, ARL stated that the gross sales information of the final 4 months signifies that product from different sources was moved by OMCs in ARL fed space thus impacting the nation IFEM/shoppers, and ARL product was not prioritised.
In accordance the info shared by ARL with OGRA stated that in the course of the month of August off-take from ARL was 8.64 % lower than the supplied amount of 63,000 Metric Tonne, in September 20.48 % much less from 54,000 MT, in October 43 % lower than 69,000 MT, in November the off-take was 27.59 % lower than the supplied amount of 71,000 MT. The letter stated that ARL was working at decrease throughput resulting from excessive shares creating severe planning and operational points. Even for the present month of December 2023, the uplifting scenario shouldn’t be encouraging and ARL would once more be shutting down its models to handle excessive shares of MS and HSD, the letter maintained.  

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