Pakistan has offered Saudi Arabia tax-free oil storage facilities, allowing Saudi companies to store commercial oil reserves in the country without paying local taxes.
Federal Minister for Petroleum Ali Pervaiz Malik made the offer during a meeting with Saudi Ambassador to Pakistan Dr. Rajeh bin Tami Al-Baqami. The two sides discussed cooperation in petroleum, mining, and energy, including oil storage, refinery upgrades, and liquefied petroleum gas (LPG) supplies.
Saudi Companies to Get Tax-Free Oil Storage
The petroleum minister told the Saudi ambassador that Pakistan had approved a tax-neutral bonded policy based on international energy hubs such as Fujairah and Singapore.
Under the policy, Saudi companies will be able to store oil in Pakistan without facing local tax liabilities.
According to an official statement, the arrangement could help Saudi Arabia reduce its dependence on shipping routes exposed to regional risks, particularly the Strait of Hormuz and the Bab el-Mandeb Strait.
It would also provide the kingdom with better access to Asian markets and greater flexibility in managing its oil supplies.
Pakistan Plans Major Oil Storage and Refining Hub
Ali Pervaiz Malik also discussed plans to establish a large petroleum storage and refining complex at Hub in Balochistan.
The proposed facility will be designed to handle Very Large Crude Carriers (VLCCs) and support Pakistan’s ambition to become an energy transit hub for Central Asian and Chinese markets.
The government has previously announced plans for an oil city at Hub, featuring offshore facilities and large-scale storage infrastructure.
The minister also invited Saudi companies to invest in Pakistan’s refinery upgrade programme, which aims to modernise local refineries and shift production towards Euro 5 fuel standards.
Pakistan Seeks More Saudi Crude Oil and LPG Supplies
The petroleum minister thanked Saudi authorities at Yanbu port for prioritising crude oil shipments to Pakistan during recent disruptions in international energy markets.
He also discussed increasing crude oil shipments through cooperation with Saudi Aramco and arranging dedicated LPG supplies ahead of higher winter demand.
Meanwhile, Saudi Ambassador Dr. Rajeh bin Tami Al-Baqami announced that the Saudi Embassy in Islamabad had introduced same-day visa processing for Pakistani citizens.
The petroleum minister also invited Saudi Vice Minister of Mining Khalid al-Mudafier to attend the Pakistan Minerals Investment Forum, scheduled for November 12 and 13 in Islamabad.
