+- Pakistan Real Estate Times - Pakistan Property News (https://www.pakrealestatetimes.com)
+-- Forum: Pakistan Real Estate / Property News (/forumdisplay.php?fid=1)
+--- Forum: Latest Pakistan Property & Economic News (/forumdisplay.php?fid=4)
+--- Thread: Gwadar oil city project stumbles (/showthread.php?tid=1282)
Gwadar oil city project stumbles - Naveed Yaseen - 10-01-2008 08:31 AM
By Khalid Mustafa
ISLAMABAD: A mega oil city at Gwadar port, which is the most strategic project with an investment of $40 billion, has hit snags as the process of acquiring land has been delayed because of a massive rise in prices of real estate.
The Government of Balochistan has informed the federal government that the cost of land for the oil city has increased manifold, which is why it is not possible to acquire land on nominal rates.
The government wants to establish at the Gwadar port the biggest crude and refined oil storage base in the region, for which it had allotted 12,500 acres of land in 2006. It had announced that the required land be made available on lease at nominal rates to interested parties for setting up refineries or making investment in oil logistics and storage facilities.
But in the latest scenario, the cash-strapped Balochistan government has no money to pay the high cost of the land needed for the project.
An official said the Balochistan administration had told the Centre that it had identified 100,000 acres of land for the project at a cost of Rs38,000 to 40,000 per acre. Balochistan also requested for release of Rs3.8 billion to acquire the land and warned of more increase in land prices if funds were not released timely.
Under the plan, the official said, the project would be executed in two phases. In Phase-1, a petrochemical city will be set up with an initial investment of $12.5 billion. In this city, a big refinery, along with petrochemical, oil logistics and storage complexes will be set up.
In the first three years, the refinery will be able to refine 10.5 million tonnes of oil annually. This capacity will be increased up to 21 million tonnes in seven to nine years.
The official said Chinese Petroleum Chamber would come up with a $12.5 billion investment plan for the project.
On behalf of China, Great United Petroleum Holdings Company Limited (GUPC) is working on the feasibility study of the petrochemical city project.
The official said GUPC would first conduct the feasibility study and preparation work for the project and then both countries would enter into a formal agreement for materialising the petrochemical city project.
The official said GUPC would also build 1,000-2,000 service stations in Pakistan as service terminals for the petrochemical city.
http://www.thenews.com.pk/daily_detail.asp?id=138847