PSO to buy 65% of Byco’s Production

Monday May 21, 2012

Source: Press release

Byco Oil Pakistan Ltd and Pakistan State Oil have signed a product sale & purchase agreement. The SPA between the two entities will ensure guaranteed sale of 65 percent of Byco’s production of various petroleum products from its new 120,000 bpd refinery to Pakistan State Oil.

This sale of petroleum products from Byco to PSO will substitute equivalent volume of imports being presently made by PSO particularly of products such as PMG, HSD and HSFO.

The agreement was inked by Naeem Yahya, Managing Director, Pakistan State Oil and M. Qaiser Jamal, Country Business Head, Oil Refining, Byco Oil Pakistan Ltd.

A unique feature of this agreement is that Byco will make sales to PSO against a confirmed letter of credit. The agreed payment arrangements will benefit the refinery to ensure timely collection of its dues which will greatly help in reducing the element of circular debt.

Byco’s new oil refinery with a crude oil processing capacity of 120,000 bpd is expected to attain mechanical completion by end June 2012. This would be followed by pre-commissioning and commissioning activities leading to commercial operations by 4th quarter 2012. Along with the existing 35,000 bpd refinery, the commissioning of the new refinery will make Byco the single largest crude oil refiner in the Country.