Pakistan will approach the United Arab Emirates to begin signing an intergovernmental agreement (IGA), seeking a government-to-government arrangement to import 1.5 million tonnes of gasoline annually.
In accordance with a five- to the eight-year agreement, Pakistan would import 1.5 million tonnes of Motor Spirit (Mogas), or 30 cargoes each year. Half to three cargoes each month would be imported from the Gulf nation.
“We have already signed the IGA template with Oman, Qatar, the Kingdom of Saudi Arabia, and a few other nations, and it will be delivered to the United Arab Emirates for the government to review and sign. Once the IGA is signed, the two nations will begin negotiating the GtG agreement for importing Mogas (petrol), crude oil, and jet fuel; a senior Energy Ministry official told The News.
During the first week of the current month, top officials from both parties met in Abu Dhabi and decided to engage in a GtG agreement to import gasoline, crude oil, and jet fuel.
This would assist Pakistan in maintaining a sustainable supply of petroleum products. “More crucially, the GtG agreement would also bring monetary relief in the form of lower charges for the import of gasoline and other goods.”
Once the IGA is finalized and signed, Pakistan State Oil (PSO) and ADNOC (Abu Dhabi National Oil Company) will begin negotiations for a GtG commercial deal on behalf of Pakistan and the UAE, respectively.
Pakistan desires that the IGA and business agreements be signed by December 31, 2022, so that imports of UAE petroleum on a GtG basis can begin in January 2023.
The official stated that following the signing of the IGA, both parties would begin discussions on the framework of the commercial agreement and finalize the specifications of gasoline, jet fuel, and crude oil for the country’s existing refineries.
PSO receives diesel from KPC (Kuwait Petroleum Company) under the terms of the GtG agreement and acquires gasoline from the open market at a premium based on the cost of products on the global market.
Under the GtG agreement, PSO would receive gasoline from ADNOC at a predetermined price. In addition, PSO would import jet fuel as needed, as the country’s refineries typically meet jet fuel demands.
