China’s Huanqiu Contracting & Engineering Corporation (HQC) has shown interest in setting up an oil refinery in Pakistan’s coastal town of Gwadar and in Karak in the country’s troubled northwestern province of Khyber-Pakhtunkhwa.
Pakistan, South Asia-s second-largest economy produces around 100,000 barrels of oil per day and import nearly 80 percent of a mix of crude and refined petroleum products to meet the domestic demand – the top item on its import list.
China is country’s “all-weather” ally and has made significant contribution to building the country’s infrastructure, the most recent being the $46 billion agreement the two countries signed last year for Chinese investment in projects ranging from dams to power units.
President Wang Guobin of HQC, a subsidiary of China National Petroleum Corporation, met Miftah Ismail, chairman Pakistan’s Board of Investment on Jan. 14 in Islamabad and discussed opportunities for his company to invest in Pakistan, according to an official announcement.
Mr. Wang expressed desire of his company to set up oil refinery in Pakistan, preferably at Gwadar and Karak. HQC is a state-owned enterprise and engaged in diversified businesses such as consultation, research and development, engineering, construction management and equipment manufacturer.
A coastal town in south-western Baluchistan province, Gwadar is a port town and seen as part of China’s strategic ambition to reach out to the Indian Ocean. Chinese government provided $248 million for the first phase of the Gwadar Port which began functioning in 2007.
The port was run by Singapore’s PSA International Pte. Until February, 2013 when Pakistan transferred its control to a Chinese company, China Overseas Port Holdings Co.
Mr. Ismail informed the Chinese delegation led by Mr. Wang that Pakistan is encouraging the private sector for setting up oil refineries. Recently a UAE company has also shown interest in building a refinery in Khyber-Pakhtunkhwa.
Pakistan has made this sector tax-free for 20 years and relevant laws have been tailored to safeguard and ensure investment protection, Mr. Ismail said.