Chevron eyes fuel storage in Pakistan for local and foreign trade

ISLAMABAD: US-based Chevron Energy Joint has expressed interest in storing and trading fuel in Pakistan and abroad through private or public bonded warehouses, an official of the Energy Ministry told The News on Monday.

The company is the only foreign firm to show seriousness for the business opportunity since the government issued a policy on September 1, 2023, allowing foreign suppliers to import, store, and re-export crude oil and petroleum products in the country, the official said.

"Apart from Chevron, no foreign firm has shown interest in any kind of fuel trade through bonded warehouses since September 1, 2023, when the government issued the notified policy guidelines for the import of foreign supplier's accounts through customs-bonded storage facilities in the country in order to enhance supply access of POL products to the local OMCs," the official added.

"Chevron has shown a willingness to initially show interest in using the warehouses in KPT." The policy also permits the re-export of crude oil and petroleum products received into the country for storage in Customs Public Bonded Warehouses.

The guidelines have enabled foreign suppliers not only to store crude oil but also POL products in Pakistan's ports and anywhere in the country, ensuring a sustainable supply of fuel across the country. This would also help avoid any fuel availability crisis in the future.

Under the policy guidelines notified, foreign suppliers or their registered subsidiaries will be allowed to maintain an inventory of crude and petroleum products in bulk form, in their own private bonded warehouses or Customs Public Bonded Warehouse located anywhere in Pakistan (without foreign exchange remittances) pending its sale to local purchasers or its re-export from storages to other foreign countries.

Foreign suppliers will have the option to establish their own registered business or operate through a subsidiary company registered in Pakistan, having bank accounts in the country to act under the relevant Pakistani laws for undertaking business activities.

Additionally, the subsidiary can develop its dedicated storage infrastructure and utilize customs public bonded warehouse facilities for storing crude oil and petroleum products under the Pakistan Oil (Refining, Blending, Transportation, Storage, and Marketing) Rules 2016.

The consignee will have the options to develop their own dedicated storage infrastructure and utilize the customs public bonded warehouse facility on a rent basis located around port premises or anywhere in Pakistan for storing crude oil and petroleum products.