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Pakistan’s four government-backed oil and gas companies are joining forces with oil giant Saudi Aramco for a $10bn (Sr37bn) Greenfield refinery project, reported state-run Associated Press of Pakistan.

Through a “joint investment strategy,” the Pakistani state-owned companies Oil and Gas Development Company, Pakistan State Oil, Pakistan Petroleum, and Government Holdings Private) will work with Aramco.

A memorandum of understanding (MoU) between the  parties has been signed.

The refinery will be built at the strategic Gwadar Port in the country’s Balochistan province.

The project contemplates building an integrated refinery in Pakistan that can process at least 300,000 barrels of crude oil per day.

A petrochemical complex is also included in the plan.

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The integrated refinery petrochemical complex will include a variety of elements, including pipeline connectivity, petrochemical facilities, storage for raw materials and refined products, and marine infrastructure.

In a separate statement, OGDCL said: “The project will benefit from the incentives offered by the Government of Pakistan under the Pakistan Oil Refining Policy for New/Greenfield Refineries, 2023 and provide an opportunity to OGDCL for vertical integration in the oil and gas sector.”

During Saudi Crown Prince Mohammad bin Salman’s visit to Islamabad in 2019, Pakistan and Saudi Arabia signed a deal to build an oil refinery in Pakistan’s strategically important port city of Gwadar, according to the Turkish state-run news agency Anadolu Ajansı.

Notably, Gwadar Port is part of the multi-billion dollar China-Pakistan Economic Corridor.

Citing experts’ claims, Anadolu Ajansı reported that Saudi Arabia exports most of its oil through its western Red Sea ports. The kingdom will have another choice because of Gwadar Port.