“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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@Sohail Malik: Dr.Asim is supported to become interim Prime Minister because to safeguard the mafias and further down value our Rupee to unprecedented low value.The conspiracy game has started.
@Ali: Every body has the right to squeeze whatever he can,ultimate loosers are the people who are never asked to participate in such deals.Orgra is a white elephant safeguarding the interests of the mafias.One such person in UAE with 56 billion is that not enough who work and protect whom in the name of regulation.These sucker all of them without fail should be snatched of the powers of regulatory authority as well the byco company be told to get thing in order according to the law and levy of 0.15/litre be suspended.
@Khalid Khan: But not by bribing and taking undue favors which put burden on common man who is already squeezed to limits.
Either Ogra is demanding their pie of the share from the under hand deal or Byco is pushing through to create a international crises.ECC has filled his tummy giving the go aheadand charging the people with 0.15/litre a lot of money,just like the rental projects.What authority the ECC has to impose before duly conferring or a debate with the people who are the main sufferers of these indoor games.
@Sohail Malik: It is exactly because of this myopic mindset that companies like BP, Chevron, ICI, HSBC, Amex bank, RBS ABN AMRO and many others have left or leaving Pakistan. Lets facilitate investors rather than adopt a socialist attitude. Have we ever tried to understand their problems?Some people are generally averse to development for e.g. the opponents of the Metro Bus.!
@Khalid Khan: I'm with Sohail on this one. Byco has a dismal record of making payments to its suppliers, contractors and creditors, regardless of its financial position. There are people waiting for over 2 years to collect their dues from Byco.
Such a company may have government support, but people who know its delaying tactics certainly won't hold it in good regard.
@Khalid Khan: I would certainly agree with you and i am a firm believer of creating favourable environment for foreign investment but had you any understanding of this trade you would have known how Byco and Abraaj operates you wouldn't have commented like this, there is not a single occasion when Byco and company have honoured their commitments they just want to fleece this country without any regard for the end users that is you and me.
The contents of this story read more like negotiations between Byco and Ogra. I wonder what's the big deal. Such negotiations between businesses and regulators are the norm.
@Sohail Malik: We should appreciate if someone is investing money in Pakistan. Byco sponsors could have easily taken this investment elsewhere. This is the difference between Pakistan and India mindset.
Oh so sorry to hear that! Now what is Byco going to do once The Dr Asim leaves office ! Who is going to do their bidding, who is going to rush summaries to the ECC to favour Byco, So SAD.....