Athens-based Consolidated Contractors International Company (CCC) says that its plan to build a fuel oil pipeline on a build-own-operate (BOO) basis is still on track, despite recent local press reports that the government was considering cancelling the project. CCC says that progress had been stalled by recent political uncertainty, but that negotiations will recommence soon.
The pipeline is to be built by the Indus Pipeline Company (IPC), which comprises CCC, Pakistan State Oil (PSO) and two Japanese companies – Kanematsu Corporation and Nittetosu Shoji Company. IPC signed an implementation agreement with the government in September under which IPC will build a pipeline from Port Qasim to Jamshoro at an estimated cost of $125 million. The pipeline will have a capacity of 3 million-4 million tonnes a year of fuel oil. It will mainly serve the Jamshoro power plant, currently supplied with oil by road and rail.
CCC says that it is now working on the fuel oil transportation agreement to be signed with PSO. The agreement will govern the conditions of supply and off-take of the oil transported by the pipeline. National oil company PSO will be both supplier and off-taker. It is hoped that documentation will be completed by August this year. Kanematsu and Nittetosu Shoji are arranging finance for the scheme, expected to include a debt portion of about $90 million (MEED 18:10:96).