CCP approves PRL’s shares’ acquisition

KARACHI: The Competition Commission of Pakistan (CCP) approved the acquisition of up to 26.67 percent shares in Pakistan Refinery Limited (PRL) by the Pakistan State Oil Company Limited (PSO), a statement said on Thursday.

PRL is a local refinery producing various refined petroleum products, such as motor gasoline, kerosene, and diesel oil for supply to oil marketing companies. The PSO is an oil marketing company engaged in the supply of refined petroleum products to end consumers.

The approval order was passed by a bench, comprising Chairperson Vadiya Khalil and members Ikramul Haque Qureshi and Shahzad Ansar of CCP.

CCP also disposed of a complaint filed by Hascol Petroleum Limited (Hascol) regarding the potential discontinuation of supply of refined petroleum products by PRL to PSO’s competitors after the acquisition.

The commission observed that the acquisition of PRL’s shares by PSO would not substantially lessen competition in the market. It was noted that PRL’s share in the local refined petroleum product market was around 10 percent and that local refineries, including PRL collectively supplied less than 50 percent of the total demand of refined petroleum products in Pakistan while the rest is met by imports by oil marketing companies. 

“With imports being readily available, the PSO will have no incentive to foreclose the supply of refined petroleum products from PRL to its competitors such as Hascol,” the statement said. “Furthermore, with downstream petroleum industry regulated by Oil and Gas Regulatory Authority, there is no chance of PSO raising prices for competitors or end consumers.”

The CCP directed both the PSO and PRL not to engage in any form of exclusionary conduct, and to continue offering its refined petroleum products to other oil marketing companies, including Hascol on commercially viable and competitive terms.