Byco refinery told to seek international safety certificate
OGRA refuses to allow refinery to start operations before getting NOC.
ISLAMABAD:
Staving off pressure from the government’s top brass, the Oil and Gas Regulatory Authority (Ogra) has refused to allow full-fledged operations to Byco’s new refinery in the absence of a clearance certificate from an international oil spill control agency to address fears of oil leak.
“If Ogra allows Byco’s Single Point Mooring facility to work without being certified from an international agency, and an oil spill occurs, it will pollute the sea, triggering a major scandal,” an official told The Express Tribune.
Byco Oil Pakistan Limited has recently completed work on the new refinery with a capacity of 120,000 barrels per day situated close to the company’s first refinery in Hub, Balochistan.
Despite repeated attempts to approach Byco Chief Executive Officer (CEO) Amir Abbassciy, he was not available for comments.
Earlier, Byco had been allowed to operate the Single Point Mooring – the first such facility in the country – for testing purpose and it also handled some crude oil consignments.
“Now, Byco has come up with the demand that it should be allowed to run full-fledged operations without seeking a no-objection certificate (NOC) as representatives of the international oil spill control agency are reluctant to visit Pakistan due to poor law and order conditions,” the official said.
Byco management has assured the government that it will be responsible for any oil spill. But, according to sources, Ogra is unrelenting because of fears of a mishap and wants Byco to obtain NOC from the third party before kicking off regular operations.
They cite the case of British Petroleum, which was forced to pay billions of dollars for an accident at its oil rig in the Gulf of Mexico that caused a major oil leak.
The Economic Coordination Committee (ECC) of the cabinet has allowed Byco to charge Rs0.15 on every litre of petrol to meet the transport cost of crude oil feedstock from tankers discharged at the Single Point Mooring, installed 15 kms into deep sea, to the seashore.
Byco management contends that it will be receiving imported crude oil at the Single Point Mooring and will not be causing any additional burden on the exchequer.
Initially, Byco Petroleum Pakistan, earlier known as Bosicor Pakistan, had set up an oil refinery with a capacity of 35,000 barrels per day in Hub, which had been working since 2004. Recently, Byco Oil Pakistan established another refinery of a capacity of 120,000 barrels per day close to the first refinery.
According to Byco estimates, the project with 40% foreign investment has cost about $700 million and the Single Point Mooring $90 million.
The ECC, in a meeting held in April 2012, had given tax exemptions to Byco for seven and a half years, despite the fact that the company failed to start the refinery by the scheduled time of December 2011. The ECC allowed a one-year extension to complete the project.
Byco had sought 20-year tax holiday, but it was allowed concessions for only seven and a half years because it was considered a relocated project.
Published in The Express Tribune, March 15th, 2013.
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Staving off pressure from the government’s top brass, the Oil and Gas Regulatory Authority (Ogra) has refused to allow full-fledged operations to Byco’s new refinery in the absence of a clearance certificate from an international oil spill control agency to address fears of oil leak.
“If Ogra allows Byco’s Single Point Mooring facility to work without being certified from an international agency, and an oil spill occurs, it will pollute the sea, triggering a major scandal,” an official told The Express Tribune.
Byco Oil Pakistan Limited has recently completed work on the new refinery with a capacity of 120,000 barrels per day situated close to the company’s first refinery in Hub, Balochistan.
Despite repeated attempts to approach Byco Chief Executive Officer (CEO) Amir Abbassciy, he was not available for comments.
Earlier, Byco had been allowed to operate the Single Point Mooring – the first such facility in the country – for testing purpose and it also handled some crude oil consignments.
“Now, Byco has come up with the demand that it should be allowed to run full-fledged operations without seeking a no-objection certificate (NOC) as representatives of the international oil spill control agency are reluctant to visit Pakistan due to poor law and order conditions,” the official said.
Byco management has assured the government that it will be responsible for any oil spill. But, according to sources, Ogra is unrelenting because of fears of a mishap and wants Byco to obtain NOC from the third party before kicking off regular operations.
They cite the case of British Petroleum, which was forced to pay billions of dollars for an accident at its oil rig in the Gulf of Mexico that caused a major oil leak.
The Economic Coordination Committee (ECC) of the cabinet has allowed Byco to charge Rs0.15 on every litre of petrol to meet the transport cost of crude oil feedstock from tankers discharged at the Single Point Mooring, installed 15 kms into deep sea, to the seashore.
Byco management contends that it will be receiving imported crude oil at the Single Point Mooring and will not be causing any additional burden on the exchequer.
Initially, Byco Petroleum Pakistan, earlier known as Bosicor Pakistan, had set up an oil refinery with a capacity of 35,000 barrels per day in Hub, which had been working since 2004. Recently, Byco Oil Pakistan established another refinery of a capacity of 120,000 barrels per day close to the first refinery.
According to Byco estimates, the project with 40% foreign investment has cost about $700 million and the Single Point Mooring $90 million.
The ECC, in a meeting held in April 2012, had given tax exemptions to Byco for seven and a half years, despite the fact that the company failed to start the refinery by the scheduled time of December 2011. The ECC allowed a one-year extension to complete the project.
Byco had sought 20-year tax holiday, but it was allowed concessions for only seven and a half years because it was considered a relocated project.
Published in The Express Tribune, March 15th, 2013.
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