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Category: Energy

You can go through stories related to energy. The stories are about changes in petroleum prices and updates on energy sector of Pakistan and world.

  • Petrol tax rate cut by 73% to lower global oil price impact

    Petrol tax rate cut by 73% to lower global oil price impact

    ISLAMABAD: The federal government has announced a reduction of 73 per cent in sales tax rate on supply of petrol in order lower the impact of high global oil prices.

    In this regard the Federal Board of Revenue (FBR) issued a notification i.e. SRO 1450(I)/2021 to reduce the sales tax rate on petrol and High Speed Diesel (HSD).

    According to the notification the rate of sales tax has been reduced to 1.43 per cent from the rate of 6.84 per cent. The FBR issued previous notification SRO 1327(I)/2021 on October 7, 2021.

    The revenue body also reduced the rate of sales tax on High Speed Diesel (HSD) to 6.75 per cent from 10.32 per cent.

    However, the sales tax rates on kerosene and Light Diesel Oil (LDO) have been kept unchanged at 6.70 per cent and 0.20 per cent, respectively.

    It is worth mentioning here that the normal rate of sales tax is 17 per cent. The present government has already reduced the rate of sales tax on petroleum products to the lowest level to minimize the impact of sharp rise in global oil prices.

    The government on November 04, 2021 notified increased in petroleum prices, which are now all time high.

    The petrol was fixed at Rs145.82 per litre instead of Rs137.79, showing an increase of Rs8.03. The price has been increased from previous high of Rs137.79.

    Similarly, the price of high speed diesel has been increased by Rs8.14 to Rs142.62 from Rs134.48.

    The rate of kerosene oil has been increased by 6.27 per liter to Rs116.53 from Rs110.26. Likewise, the price of light diesel oil has been increased by Rs5.72 per liter to Rs114.07 from Rs108.35.

    A notification issued by the Finance Division stated that on November 01, 2021, the prime minister had not agreed with the proposals worked out by the Oil and Gas Regulatory Authority (OGRA) and the finance division directed to maintain the prices as notified on October 16, 2021.

    It is pertinent to mention that maintaining the October 16, 2021 petroleum prices had some underlying concerns for cash flow issues due to short recovery of the cost, according to the statement.

    It is important to note that in the previous petroleum prices, already a significant relief was provided to the consumers. The government is cognizant of its responsibility to provide maximum relief to the consumers.

    “This has dented the petroleum levy budget of Rs152.5 billion during July – September, 2021 as compared to Rs20 billion realized only,” it said.

    Foregoing in view, prices of petroleum products have been increased partially as compared to the prices being worked out by the OGRA. If the government had accepted OGRA’s recommendations, the new prices would have been much higher.

    Infact, the government has absorbed the bulk of the pressure after making adjustment after making adjustment in the sales tax and petroleum levy. The collection of petroleum levy is far short of its fixed target for the first quarter of the fiscal year 2021/2022, it added.

    Petrol price increases to new high of Rs145.82 per liter
  • ITFC provides $761.5 million for Pakistan oil, gas import

    ITFC provides $761.5 million for Pakistan oil, gas import

    ISLAMABAD: The International Islamic Trade Finance Corporation (ITFC) will provide financing of an amount $761.5 million to Pakistan for import of oil and gas.

    In this regard a financing agreement amounting to $761.5 million has been signed between the Ministry of Economic Affairs, Government of Pakistan and International Islamic Trade Finance Corporation (ITFC) for import of crude oil, refined petroleum products and LNG etc.

    The financing agreement was signed by Mian Asad Hayaud Din, Secretary, EAD and Eng. Hani Salem Sonbol, CEO, ITFC. The facility has been made effective immediately and ready for utilization by Pakistan State Oil Company Ltd (PSO), Pak Arab Refinery Ltd (PARCO) and Pakistan LNG Ltd (PLL) for import of oil and gas.

    This Syndicated Murabaha Financing facility of $ 761.5 million is for a period of one year and is a part of umbrella Framework Agreement signed with ITFC in June 2021 for total envelop of $ 4.5 billion ($ 1.5 million annually) for a period of three-years.

    Originally, ITFC had agreed to provide the financing of US$ 300 million. However, due to growing energy needs of the country and enhanced confidence level of international financial institutions on economic reforms and recovery amid COVID-19 pandemic, the financing was over-subscribed by 2.5 times i.e. from $ 300 million to from $ 761.5 million.

    The financing facility will also be helpful in financing oil and gas import bill of the country and easing of pressure on foreign exchange reserves of the country.

    Mian Asad Hayaud Din, Secretary, EAD appreciated the support for ITFc for arranging US$ 761.5 million for trade financing. He lauded the efforts of Eng. Hani Salem Sonbol, CEO, ITFC and his team for making this transaction successful.

    The ITFC and GOP have also agreed to continue their cooperation in future to mobilize financial resources to support Pakistan in its endeavours to achieve its economic growth targets through ITFC financing facility.

    Trade financing facility of $551 million signed for import oil, LNG
  • Petrol price increases to new high of Rs145.82 per liter

    Petrol price increases to new high of Rs145.82 per liter

    ISLAMABAD: The government on Thursday night announced an increase of Rs8.03 to Rs145.82 per liter in the price of petrol effective from November 05, 2021.

    The government announced increase in prices of all petroleum products.

    The price has been increased from previous high of Rs137.79.

    Similarly, the price of high speed diesel has been increased by Rs8.14 to Rs142.62 from Rs134.48.

    The rate of kerosene oil has been increased by 6.27 per liter to Rs116.53 from Rs110.26. Likewise, the price of light diesel oil has been increased by Rs5.72 per liter to Rs114.07 from Rs108.35.

    A notification issued by the Finance Division stated that on November 01, 2021, the prime minister had not agreed with the proposals worked out by the Oil and Gas Regulatory Authority (OGRA) and the finance division directed to maintain the prices as notified on October 16, 2021.

    It is pertinent to mention that maintaining the October 16, 2021 petroleum prices had some underlying concerns for cash flow issues due to short recovery of the cost, according to the statement.

    It is important to note that in the previous petroleum prices, already a significant relief was provided to the consumers. The government is cognizant of its responsibility to provide maximum relief to the consumers.

    “This has dented the petroleum levy budget of Rs152.5 billion during July – September, 2021 as compared to Rs20 billion realized only,” it said.

    Foregoing in view, prices of petroleum products have been increased partially as compared to the prices being worked out by the OGRA. If the government had accepted OGRA’s recommendations, the new prices would have been much higher.

    Infact, the government has absorbed the bulk of the pressure after making adjustment after making adjustment in the sales tax and petroleum levy. The collection of petroleum levy is far short of its fixed target for the first quarter of the fiscal year 2021/2022, it added.

    Petrol price goes up to record high at Rs137.79/liter
  • Pakistan’s October oil sales highest after May 2018

    Pakistan’s October oil sales highest after May 2018

    KARACHI: Pakistan’s domestic oil sales in October 2021 recorded 1.99 million tons, which is the highest since May 2018, analysts at Topline Research said on Tuesday.

    Pakistan’s oil sales have increased by 17 per cent YoY to 1.99 million tons in October 2021 (and also up 3 per cent MoM), which is the highest monthly sales after May-2018.

    In first four months of fiscal year 2021/2022, Pakistan oil sales have increased by 22 per cent YoY to 7.8 million tons driven by macro recovery.

    High Speed Diesel (HSD) registered strong growth in October 2021 and was up by 25 per cent YoY to 0.8 million tons. The analysts attribute the growth to increased transportation activity and Large Scale Manufacturing (LSM) growth.

    Petrol sales were up 12 per cent YoY to 0.8 million in October 2021 led by rising car sales. This is despite a 12 per cent increase in petrol prices during the month indicating strong demand.

    Furnace Oil (FO) sales also grew by 12 per cent YoY to 0.3 million tons. FO growth may improve further in the winter season as Pakistan is likely to witness gas and RLNG shortages.

    Amongst the listed companies, Pakistan State Oil (PSO) and Shell Pakistan (SHEL) remained outperformers as sales were up 35 per cent YoY and 22 per cent YoY, respectively.

    On other hand, Hascol Petroleum (HASCOL) and Attock Petroleum (APL) reported sales decline of 73 per cent YoY and 3 per cent YoY, respectively.

    PSO achieved a market share of 52 per cent in October 2021 compared to 45 per cent in October 2020. MS and HSD sales of PSO have grown by 32 per cent and 46 per cent YoY, respectively.

    SHEL sales were mainly led by higher HSD and MS sales (up 38 per cent YoY and 11 per cent YoY, respectively). APL lower sales were mainly owing to 42 per cent YoY lower FO sales.

    HASCOL continued to face sales decline across all the segments driven by its liquidity crunch.

    Pakistan oil sales increase by 26% in September
  • OGDCL declares Rs33.63 billion net profit in first quarter

    OGDCL declares Rs33.63 billion net profit in first quarter

    KARACHI: Oil and Gas Development Company Limited (OGDCL) on Friday announced its financial result, posting a profit after tax (PAT) of Rs33.629 billion during the first quarter ended September 30, 2021.

    The profit of the company has surged by 44 per cent when compared with the net profit of Rs23.344 billion in the first quarter of the last fiscal year.

    The company declared earnings per share at Rs7.82 for the quarter under review as compared with Rs5.43 in the same quarter of the last year.

    Alongside the result, the company announced an interim cash dividend of Rs 1.75/share for the first quarter of fiscal year 2021/2022 (Rs 2.00 in 1QFY21).

    According to Arif Habib Research, topline clocked-in at Rs71,531 million in 1QFY22 against Rs56,347 million in same period last year (SPLY), up by 27 per cent YoY, on the back of i) a massive 70 per cent YoY jump in oil prices, and ii) 4 per cent YoY growth in oil production. Whereas, gas production plummeted by 10 per cent YoY during the quarter.  On a sequential basis, net sales ascended by 14 per cent given 9 per cent QoQ growth in oil prices along 2 per cent QoQ higher oil production.

    The exploration costs declined by 23 per cent YoY arriving at Rs 2,283 million in 1QFY22 given dry well (Bago Phulphoto) reported during the quarter compared to three dry wells (Jun-01, Umair North West and Jatoi-01) incurred in SPLY. Whereas on QoQ basis, exploration costs plunged by 65 per cent given two drys (Washuk-01 and Kambir) and higher seismic activity incurred in 4QFY21.

    Other income in 1QFY22 settled at Rs 10,878 million versus Rs 5,958 million in SPLY, significantly up 83 per cent YoY, amid exchange gain on foreign currency tagged with higher income from cash and cash balances. Similarly, other income on QoQ basis climbed up by 89 per cent due to USD appreciation against Rs.

    The company booked effective taxation at 36 per cent in 1QFY22 vis-à-vis 31 per cent in 1QFY21.

    OGDCL discovers huge gas deposits in Balochistan
  • KE’s profit up by 161% on high tariff adjustment

    KE’s profit up by 161% on high tariff adjustment

    KARACHI: K-Electric Limited (KE), the power generating and supply company, on Thursday announced massive 161 per cent growth in net profit for quarter ended September 30, 2021, mainly surge in revenue in the shape of tariff adjustment.

    The profit after tax of the KE grew by 161 per cent to Rs2.9 billion for the quarter ended September 30, 2021 as compared with Rs1.11 billion in the same quarter of the last year.

    The company announced Rs0.11 as earnings per share (EPS) for the quarter under review as compared with Rs0.04.

    The revenue of KE exhibited sharp growth of 33 per cent to Rs114.14 billion for the quarter ended September 30, 2021 as compared with Rs85.55 billion in the same quarter of the last year.

    The sales of energy grew by 27 per cent to Rs86.92 billion for the quarter under review as compared with Rs68.40 billion in the same quarter of the last year.

    In the head of tariff adjustment, the revenue of the company recorded 58.72 per cent increase to Rs27.22 billion for the quarter ended September 30, 2021 as compared with Rs17.15 billion in the same quarter of the last year.

    Cost of sale grew by 36 per cent to Rs97.49 billion as against Rs71.68 billion.

    Operating expenses of KE recorded a significant increase to Rs1.81 billion for the quarter ended September 30, 2021 as compared with Rs338 million in the same quarter of the last year.

    PSO registers 120% growth in quarterly profits
  • PSO registers 120% growth in quarterly profits

    PSO registers 120% growth in quarterly profits

    KARACHI: Pakistan State Oil (PSO) on Thursday announced a massive jump in its quarterly net profit by over 120 per cent for the period ended September 30, 2021.

    According to consolidated results, the profit of the company surged to Rs11.53 billion for the quarter ended September 30, 2021, as compared with Rs5.22 billion in the same quarter of the last year.

    PSO announced Rs24.93 as earning per share for the quarter ended September 30, 2021 as compared with Rs11.07 in the same quarter of the last year.

    The company in its board of management meeting held on October 28, 2021 approved the results and recommended no dividend for the period.

    The company posted a gross profit of Rs 22.1 billion with gross margins set at 4.80 per cent in the first quarter of 2021/2022 compared to gross profit of Rs 11.5 billion (4.09 per cent gross margins) in the prior year.

    Analysts view noteworthy changes in ex-refinery prices that resulted in inventory gains of around Rs 7 billion in 1QFY22 compared to inventory gains of Rs 1.5 billion in same period last year.

    Other operating income decreased by 87 per cent QoQ to Rs 1,786 million in 1QFY22. We believe, absence of Late Payment Surcharge (LPS) resulted in decline in other income.

    Meanwhile, finance costs nosedived by 92 per cent QoQ and 27 per cent YoY to Rs 626mn which is owing to lower reliance on short term borrowings and lower interest rates, we view.

    The company recorded effective taxation at 32.6 per cent in 1QFY22 compared to 33.0 per cent in 1QFY21.

    PSO’s prudent planning helps considerable savings
  • PPL posts 18% net profit growth in first quarter

    PPL posts 18% net profit growth in first quarter

    KARACHI: Pakistan Petroleum Limited (PPL) has announced 18 per cent growth in net profit of the first quarter ended September 30, 2021.

    The company announced profit after tax of Rs16.86 billion during the first quarter (July – September) of the current fiscal year as compared with Rs14.32 billion in the corresponding period of the last fiscal year.

    PPL announced earnings per share at Rs6.2 for the quarter under review as compared with Rs5.26 EPS in the same quarter of the last year.

    The board of directors of the company at its meeting held on Monday approved the unconsolidated and consolidated financial statements for the first quarter ended September 30, 2021.

    The company declared revenue growth to Rs43.59 billion during the first quarter of the current fiscal year as compared with Rs39.32 billion in the same quarter of the last fiscal year.

    Operating expenses of the company also grew to Rs10.43 billion as compared with Rs9.4 billion.

    Under the head of royalties and other levies, the company paid an amount of Rs6.43 billion during the first quarter of the current fiscal year as compared with Rs5.95 billion in the same period of the last year.

    The exploration expenses of the company increased to Rs4.86 billion during the quarter of July – September 2021 as compared with 2.29 billion in the same period of the last year.

    Pakistan Petroleum discovers hydrocarbons in Sindh
  • Engro Corp posts 23% revenue growth in nine months

    Engro Corp posts 23% revenue growth in nine months

    KARACHI: Engro Corporation Limited has posted a significant 23 per cent growth in consolidated revenue for the nine-month period ended on September 30, 2021.

    Pakistan’s premier conglomerate, Engro Corporation (PSX: ENGRO) announced its financial results for the third quarter ended September 30, 2021.

    Engro delivered a strong operational performance in first nine months of 2021 as its consolidated revenue grew by 23 per cent from Rs 182,497 million as compared with Rs223,581 million in the corresponding period of the last year.

    The company recorded a consolidated Profit After Tax (PAT) of Rs40,504 million up by 31 per cent from same period last year.

    Profit attributable to the owners stood at Rs23,173 million compared to Rs18,345 million in the first nine months of 2020, resulting in an Earnings per Share (EPS) of Rs40.22 compared to Rs31.84 in the nine months of 2020. The growth in the bottom line is primarily attributable to increased profits posted by Fertilizers and Petrochemicals businesses.

    On a standalone basis, the Company posted a PAT of Rs 16,015 million against Rs 9,283 million in 9M 2020, translating into an EPS of Rs 27.80 per share. The Company also announced an interim cash dividend of Rs 5 per share for third quarter taking the total dividend distributed for the year to Rs 24 per share.

    Financial Performance – Segmental Perspective:

    Fertilizers: Domestic market witnessed strong agricultural sector performance in 2021 with limited impact from COVID-19 led lockdowns. Prices of agri commodities remained firm during the quarter resulting in improved earnings for farmers and higher urea industry volumes versus prior year.

    Engro Fertilizers Limited (“EFert”) revenue during the period stood at Rs 92,742 million versus 78,138 million on the back of higher Urea sales of 1,644 KT in comparison to 1,451 KT in 9M 2020. Urea production stood 1,560 KT versus 1,694 KT in 9M 2020 on account of planned plant turnarounds. EFert recorded Phosphate sales of 242 KT against 366 KT in 9M 2020. As a result, the PAT for EFert stood at Rs 14,921 million for 9M 2021 as compared to Rs 11,491 million in the same period last year.

    Petrochemicals: International PVC prices reached an all-time high of $1850/MT by September end due to high demand along with global supply disruptions. Domestic PVC market recorded a volumetric increase of 30 per cent in Q3 2021 against previous quarter as buying sentiment improved.

    Engro Polymers and Chemicals Limited (“EPCL”) announced commercial operations of the new PVC plant on March 01, 2021, increasing the capacity by 100 KT to 295 KT per annum and commercial operations of 50 KT new VCM DBN capacity on June 25, 2021 increasing capacity to 245 KT per annum.

    In 9M 2021, EPCL recorded a revenue of Rs 49,323 million as compared to Rs 22,931 million in in 9M 2020. The business witnessed its highest ever profit of Rs 10,372 million versus Rs 2,103 million on account of increased volumetric sales, efficient operations and higher international prices.

    Connectivity: Engro continued to expand its footprint through Engro Enfrashare which has now become the country’s largest Independent TowerCo (with 48 per cent market share vs 41 per cent in 2020) in terms of operational sites, serving all Mobile Network Operators in Pakistan. As at September 30, 2021, Enfrashare held a portfolio size of 2,030 operational sites and 2,219 tenancies resulting in a tenancy ratio of 1.09x.

    The telecom sector in Pakistan is registering an annual growth of 28 per cent with the 3G / 4G subscriber base expanding beyond 100 million. This has led Engro to enhance its total equity investment in the Telecom Infrastructure vertical to Rs 21.5 billion. Engro has also formed a dedicated platform for connectivity and telecom infrastructure related initiatives by the name of Engro Connect (Pvt.) Limited. Engro Connect is a wholly owned subsidiary of Engro and will hold complete ownership of Engro Enfrashare (Pvt.) Limited.

    Energy & Power: Sindh Engro Coal Mining Company (“SECMC”) supplied around 3 million tons of coal to Engro Powergen Thar Limited (“EPTL”) during the period. SECMC’s expansion work to enhance its output to 7.6 million tons per annum is in progress. EPTL remained fully operational and achieved 84.7 per cent availability with a load factor of 82 per cent, dispatching 3,253 GwH to the national grid during the period.

    Engro Powergen Qadirpur Limited (“EPQL”) operates on permeate gas and is currently facing gas curtailment from the Qadirpur gas field as it continues to deplete. To make up for this shortfall, EPQL’s plant has been made available on mixed mode. The plant dispatched a net electrical output of 615 GwH to the national grid with a load factor of 44 per cent compared to 32 per cent during the same period last year. EPQL posted a PAT of Rs 1,463 million for the current period as compared to Rs 2,031 million for 9M 2020, which is mainly attributable to retirement of debt component.

    Terminals: Profitability of both the LNG and chemicals terminal remained healthy during the period. The chemicals terminal throughput volumes normalized to 934 KT versus 806 KT last year as volumes were impacted in 2020 due to lockdowns because of COVID-19. The LNG terminal handled 52 cargoes against 54 cargoes during same period last year, delivering 158 bcf re-gasified LNG in to the SSGC network.

    With around two years of planning and efforts amidst COVID-19 volatility, Engro Elengy Terminal Limited (“EETL”) has successfully completed Pakistan’s first-ever dry docking activity at Qatar dockyard. During the dry docking period, FSRU Sequoia enabled gas supply continuity ensuring national energy security. After completion of its dry docking, FSRU Exquisite has now returned to Pakistan and is online.

    Engro Corp registers 84% net profit in first half
  • Bestway to set up Brownfield cement plant

    Bestway to set up Brownfield cement plant

    KARACHI: Bestway Cement Limited announced on Friday its plans to significantly expand its production and energy capabilities with the establishment of a Brownfield cement plant and a 6.4 MW off-grid solar power plant.

    (more…)