Plans by the local Pak-Arab Refinery (Parco)to develop a 100,000-barrel- a-day (b/d) refinery project at Multan gained new impetus with the recentaward of a pipeline contract to the US' William Brothers (Willbros). Parco is expected to finalise plans for the refinery in February.

Parco awarded Willbros the contract to build a pipeline extension from Multan to the north. It will cost Rs 2,800 million ($90.8 million). This includes a $64 million foreign currency component, which will cover Willbros' contract.

The pipeline will have a capacity of 5 million tonnes a year, or about 100,000b/d (MEED 2:12:94). It involves building a 364-kilometre extension to the existing Karachi to Multan pipeline to carry finished products to Parco's customers in Faisalabad and Lahore, which are now supplied by road. It also includespumping stations and storage facilities for 80,000 tonnes.

Parco decided in principle to go ahead with the refinery at the end of December. An implementation agreement is due to be finalised in February. A six-month basic design job will be followed by the drawing up of invitations to bid for engineering, procurement and construction work. The US' UOP Management Services (UMS) has completed a feasibility study for the work.

The refinery has been on the drawing board for several years (MEED 28:2:92; 26:4:91). It was delayed pending approval from Abu Dhabi National Oil Company (ADNOC), one of Parco's shareholders (MEED 2:12:94). The revival has been facilitated by the introduction of the government's new energy policy in the first half of 1994, industry sources say (MEED 8:4:94). The policy offers substantially improved financial incentives and promises to limit the bureaucracy surrounding private hydrocarbon projects. It is expected to vitalise several other large-scale development schemes this year.