Saudi Arabia, Pakistan ‘to sign deals worth up to $20 billion’

Pakistan army trucks park outside a presidential palace as security is beefed up in Islamabad ahead of the visit of Crown Prince Mohammed bin Salman. (AP Photo/B.K. Bangash)
Updated 17 February 2019

Saudi Arabia, Pakistan ‘to sign deals worth up to $20 billion’

  • More than 30 public and private companies are poised to invest in Pakistan, including Saudi Aramco, SABIC and ACWA Power
  • The sectors targeted for Saudi investment include oil refining, petrochemical, mining, construction, power generation, agriculture and glass

KARACHI: Saudi Arabia is expected to announce investments in Pakistan worth between $15 billion and $20 billion during Crown Prince Mohammed bin Salman’s official visit, according to the head of Pakistan’s Board of Investment.

The Kingdom and the UAE in recent months have offered Pakistan more than $30 billion in loans and investments to tackle a soaring current-account deficit. The Saudi crown prince is due to sign off on his country’s deals, including one for a $10 billion oil refinery in Pakistan’s Gwadar Port.

“We are expecting Saudi investment in the range of $15 billion to $20 billion based on the interest investors have expressed so far,” said Haroon Sharif, minister of state and chairman of the Board of Investment.

Sharif previously said that Pakistan expected investments worth about $15 billion from Saudi Arabia over the next three years, and about $40 billion from Saudi Arabia, the UAE and China combined in the next three to five years.

Mian Mehmood, the Pakistani head of the Pakistan-Saudi Arabia Joint Chamber of Commerce and Industry, said recently that in addition to the oil refinery project, a further $10 billion is expected to be invested in sectors other than oil and gas, bringing the total to $20 billion.

“About 25 to 30 agreements are expected to be finalized during the visit of the crown prince,” said Mehmood who recently led a business delegation to the Kingdom to explore bilateral investment and cooperation opportunities.

More than 30 public and private companies are poised to invest in Pakistan, including Saudi Aramco, SABIC and ACWA Power, he added.

The sectors targeted for Saudi investment include oil refining, petrochemical, mining, construction, power generation, agriculture and glass.

“Ten Saudi manufacturing companies working in construction and allied materials, and 10 companies interested in the food processing sector will come to sign agreements,” Mehmood said.

Speaking this month during a visit to Gwadar to inspect the site of the $10 billion oil refinery, Saudi Energy Minister Khalid Al-Falih said: “Saudi Arabia wants to make Pakistan’s economic development stable through establishing an oil refinery and partnership with Pakistan in the China-Pakistan Economic Corridor.”

Work on the refinery is expected to begin within 18 months.

“Once the project starts production, the country would be able to save about $2 billion in foreign exchange on costly imports,” said Samiullah Tariq, the head of research at investment firm Arif Habib Limited.


Libya’s NOC says production to rise as it seeks to revive oil industry

Updated 22 September 2020

Libya’s NOC says production to rise as it seeks to revive oil industry

  • Libya produced around 1.2 million bpd – over 1 percent of global production – before the blockade
  • Libya’s return to the oil market is sustainable

LONDON: Libya’s National Oil Company said it expected oil production to rise to 260,000 barrels per day (bpd) next week, as the OPEC member looks to revive its oil industry, crippled by a blockade since January.
Oil prices fell around 5 percent on Monday, partly due to the potential return of Libyan barrels to a market that’s already grappling with the prospect of collapsing demand from rising coronavirus cases.
Libya produced around 1.2 million bpd — over 1 percent of global production — before the blockade, which slashed the OPEC member’s output to around 100,000 bpd.
NOC, in a statement late on Monday, said it is preparing to resume exports from “secure ports” with oil tankers expected to begin arriving from Wednesday to load crude in storage over the next 72 hours.
As an initial step, exports are set to resume from the Marsa El Hariga and Brega oil terminals, it said.
The Marlin Shikoku tanker is making its way to Hariga where it is expected to load a cargo for trader Unipec, according to shipping data and traders.
Eastern Libyan commander Khalifa Haftar said last week his forces would lift their eight-month blockade of oil exports.
NOC insists it will only resume oil operations at facilities devoid of military presence.
Nearly a decade after rebel fighters backed by NATO air strikes overthrew dictator Muammar Qaddafi, Libya remains in chaos, with no central government.
The unrest has battered its oil industry, slashing production capacity down from 1.6 million bpd.
Goldman Sachs said Libya’s return should not derail the oil market’s recovery, with an upside risk to production likely to be offset by higher compliance with production cuts from other OPEC members.
“We see both logistical and political risks to a fast and sustainable increase in production,” the bank said. It expects a 400,000 bpd increase in Libyan production by December.
The Organization of the Petroleum Exporting Countries and allies led by Russia, are closely watching the Libya situation, waiting to see if this time Libya’s return to the oil market is sustainable, sources told Reuters.