Due to ongoing smuggling of petroleum products from neighbouring countries, Attock Refinery Limited (ARL) has been compelled to close its facility.
The refinery announced on Wednesday that oil marketing companies (OMCs) have been sluggish to pick up High Speed Diesel (HSD) from ARL in recent months “due to the possibility of smuggled products entering the supply envelope.”
This has resulted in a buildup of HSD inventories at the refinery, with little or no storage space available.
As a consequence, ARL has been forced to shut down for five days its main distillation unit, which has a capacity of 32,400 barrels per day (BPD). During this period, the refinery will operate at approximately 25 percent capacity in order to perform necessary maintenance on its downstream units. The company has assured stakeholders that sufficient product inventories are available to meet current demand.
The Ministry of Energy (Petroleum Division) and the Oil and Gas Regulatory Authority (OGRA) have been informed. However, it is questionable whether this action will put an end to the long-standing problem of petroleum product smuggling in Pakistan.
This illegal commerce has a significant impact on the nation’s economy, as it causes government revenue losses and harms domestic industries.
In recent years, Pakistan has taken numerous steps to combat smuggling, including tightening border controls and increasing penalties for those caught engaging in illicit trade. However, these efforts have not been wholly fruitful, and smuggling continues to be a persistent issue.
The closure of ARL’s plant demonstrates the urgent need for more effective measures to be taken to address this issue and assure the smooth operation of the nation’s oil industry.