Dubai: Abu Dhabi government will set up a $5 billion Khalifa Coastal Refinery (KCR) in Pakistan, the largest single foreign direct investment (FDI) ever made in Pakistan.
Media reports said that a delegation from the Abu Dhabi International Petroleum Investment Company (IPIC), led by UAE Minister of Energy Mohammad Bin Dha’en Al Hamili, will sign an agreement on Tuesday in Islamabad with the Ministry of Petroleum and Energy Resources.
“This is the largest single foreign direct investment (FDI) ever made in Pakistan,” said Bilal Pasha, Commercial Counsellor at the Pakistan Embassy in Abu Dhabi.
Last year, FDI from the UAE into Pakistan stood at $800 million out of a total $8 billion received worldwide.
This is also the largest investment in the oil and gas sector in Pakistan. The UAE was also the single largest contributor of FDI in 2005-06, with total investments standing at $1.6 billion, Gulf News reported.
The IPIC will hold a 76% stake in the project, while the Pak-Arab Refinery Company will have 24% in the crude oil refinery company - Khalifa Coastal Refinery (KCR). IPIC is the Abu Dhabi government’s enterprise responsible for foreign investments in the oil and chemical industries.
The KCR will be built at a strategic location along the coast of the Arabian Sea near Hub in Balochistan province of Pakistan.
Construction of the mammoth project is expected to start in January next year. Production is slated to start in December 2012. “The refinery will have the capacity to produce around 100,000 barrels of diesel per day and around 35 to 45 million barrels a year,” said Pasha.