Oil Marketing Companies (OMCs) play a very significant role in ensuring the availability of petroleum product to Pakistan’s market.
Over 30 OMCs are currently operating under license from the Oil and Gas Regulatory Authority (OGRA). Another 33 OMCs have obtained permission to establish marketing companies and will join those permitted to market product once they have fulfilled OGRA’s criteria.
Of the total 2017-18 Country Demand for Petroleum Product of around 25 Million Metric Tons , Energy Products accounted for 98% of the Market. Of these, Transportation Fuels accounted for almost 66% with Premium Motor Gasoline catering for ~ 30% and High Speed Diesel (HSD) 36%, the balance being Jet Fuel (JP-1 for commercial aircraft and JP-8 for the Armed Forces), Kerosene, Light Diesel Oil (LDO) and Furnace Oil. Non-Energy Products (Solvent, Mineral Turpentine, Jute Batching Oil, Asphalt, Lubes, Greases, BTX, Process Oil, Carbon Oil) accounted for only 2% of the total Market.
Petroleum Oil Liquid (POL) imports into Pakistan accounted for ~18 Million Tons in 2017-18. Of these, Crude Oil for the local Refineries accounted for 50%, and Refined Petroleum Product imports were ~ 9 Million Tons. Pakistan spent ~ 12 Billion USD on POL imports. Of these, ~ 7 Billion USD was spent Refined Petroleum, with transportation fuels PMG and HSD alone accounting for ~ 5 Billion USD.
Pakistan’s imports of Crude and Refined Petroleum Product take place at Karachi. The Karachi Port Trust (KPT)’s 3 Oil Piers at Keamari (KMR) have a combined annual handling capacity of 24 Million Tons, Port Qasim Authority (PQA)’s Fauji Oil Terminal Company (FOTCO) has 9 Million Tons and BYCO’s Single Point Mooring (SPM) has a capacity of 12 Million Tons. However, capacity utilization last year was as follows:
KMR 12.4 Million Tons (52%)
FOTCO 4.2 Million Tons (47%)
SPM 2.3 Million Tons (19%)
The pathetic overall 42% utilization of Port infrastructure had a number of reasons: two of KPT’s Oil Piers needed urgent repairs to be able to operate safely (the Oil Piers are also used for non-POL imports thereby curtailing availability for POL imports); FOTCO cannot cater for the PMG and Crude load that would be shifted to its PQA facility (FOTCO’s pipelines at its trestle had traditionally handled HSD and FO only (FO lines cannot be used for white oil product without operational prerequisites and procedures that cannot apply without changes at the facility itself as well as downstream storages of OMCs); BYCO’s SPM is also not connected to OMCs storages to enable it to handle volumes other than crude for BYCO’s Refinery. These are serious shortcomings that need to be addressed urgently for the Country’s energy security.
Although the use of Furnace Oil for power generation has declined sharply by almost 52% compared to 2017-18, this has created an anomalous situation for the 3 Million Tons of FO that is traditionally produced by the local Refineries. FO is not a by-product but a must-produce one whenever a refinery operates. Reduced FO use has caused the capacity utilization of local refineries to average only 72%, thereby reducing local availability of PMG and HSD, leading to higher imports of these transportation fuels. This has added to the burden on Pakistan’s import infrastructure at KMR and PQA, which has been facing acute pressure to begin with. The advent of LNG Tankers through PQA’s channel has also added another operational bottleneck at FOTCO, as the FOTCO Oil Pier is located before the LNG Terminal and simultaneous imports of POL and LNG are not possible due to safety issues. The last Downstream Petroleum Policy was announced in 1997. Since then, all policy revisions have targeted the Upstream Petroleum Sector (Exploration and Production) totally ignoring the Downstream Petroleum Sector (Oil Refining, Oil Marketing and Oil Transportation).
Although since 1997 the entire dynamics of Pakistan’s Petroleum Sector has undergone a sea change, Policy has not been able to address the changes needed to match the radically changed scenario.
Billions of Dollars of investment has already come into the Downstream Oil Sector and Billions more will be needed in the years to come in order to match infrastructure needs. The Oil Marketing Sector boasts over 8,500 Retail Outlets throughout Pakistan. Of these 950 also have CNG Facilities at their outlets. The OMCs provide employment to tens of thousands of staff at their outlets as well as create employment in thousands to associated industry ( the transport sector, depots, installations, pipeline network). The areas requiring urgent attention from the Government of Pakistan include consistency in policies, facilitation in making the business more investor-friendly, rationalization of taxes (specifically the long-unresolved issue of turnover tax), OMC and Dealer Margins.
In order to address all the existing and coming challenges to the Oil Marketing Sector, Oil Marketing Association Pakistan (OMAP) aims to be the collective face of this vital sector vis-a-vis all stakeholders in also playing its role in better planning, better product availability, improvement in quality of product with the vision the right product for the Pakistani market.
The information provided by this OMAP Website is for general information purposes only. All information on the Website is provided in good faith, however neither OMAP nor do any of its employees make any representation or warranty of any kind, express or implied, regarding the accuracy, adequacy, validity, reliability, availability or completeness of any information on the Website
Our vision is to be a significant and recognized Organization that truly represents the Oil Marketing Industry of Pakistan locally and internationally
Through a strong, connected platform of Oil and Gas Entrepreneurs and Professionals, to ensure the security and efficiency of supply of petroleum products, meet the right product needs and strive to improve quality of these products to the Pakistani consumer
We and our Members are guided by the Laws of the Country, mutual respect and trust, commitment to conduct business with integrity, transparency and honesty whilst adhering to the highest ethical standards