Legal Advice on Oil Licences for Refineries in Pakistan (Construction and Operation)

(a) Licence for Construction and Operation of a New Oil Refinery

Obtaining a licence for the construction and operation of a new oil refinery in Pakistan involves several steps and requires the submission of a comprehensive set of documents to the Oil and Gas Regulatory Authority (OGRA). Here is a detailed guide on how to navigate this process:

1. Application Submission: The application must be submitted in the format set out in Part A of Schedule I, as per the Pakistan Oil Rules, 2016.
2. Required Documents:
   • Company Information: Provide the name and address of the company’s registered office, and the names and addresses of the directors, including their nationality and shareholding details.
   • SECP Documents: Certified true copies of the Certificate of Registration, Memorandum and Articles of Association, and Forms 29 and 34, all attested by an authorised person from the Securities and Exchange Commission of Pakistan (SECP).
   • Site Possession: Documents showing possession of the site by the applicant company.
   • EPA Clearance and NOC: An Environmental Protection Agency (EPA) clearance certificate and a No Objection Certificate (NOC) from the District Government.
   • Feasibility Report: A feasibility report detailing the refinery’s work program, including storage capacity, availability of utilities (electricity, gas, water), and the minimum storage requirements for crude oil and refined oil products.
   • Port Handling Facility: A Memorandum of Understanding (MOU) with relevant agencies regarding port handling facilities for the import and storage of crude oil and the export of surplus petroleum products.
   • Source of Crude Oil: A letter of support from the source of crude oil.
   • Refinery Configuration: Details of the refinery configuration, specifying whether it is a semi-conversion or fully conversion refinery.
   • Project Cost and Financial Capacity: Details of the estimated cost of the project, with a due diligence certificate from a scheduled bank affirming the applicant company’s capacity to undertake the proposed investment.
   • Utilities and Port Facilities: Status of the availability of utilities at the site and port facilities.
   • Crude Oil Receipt and Product Disposal: Proposed arrangements for the receipt of crude oil and the disposal of products for local consumption and export.
   • Waste Disposal: Proposed arrangements for the disposal of solid, liquid, and gaseous refinery wastes in accordance with National Environmental Quality Standards (NEQS).
   • Work Program and Emergency Response: Details of the work program, schedule of completion, emergency response system, and Health, Safety, and Environment (HSE) arrangements.
   • Affidavits from Directors: Affidavits from all directors stating that they are not disqualified, have not defaulted on loans, are not involved in criminal cases, and that no legal cases are pending against them.
   • Licence Fee: A fee of Rs. 2 million in the form of a Demand Draft/Pay Order in favour of OGRA, payable at Islamabad.
3. Process and Timeline:
   • Upon receipt of a complete application, OGRA will review the submission and may request additional information or documentation as needed.
   • The Authority will evaluate the application based on compliance with technical standards and financial capacity.
   • A licence will be issued for the construction and operation of the refinery, subject to periodic inspections and compliance with regulatory requirements.

For more detailed information and assistance with the application process, you can contact Josh and Mak International.

(b) Licence for an Existing Oil Refinery

Licensing an existing oil refinery requires adherence to specific regulatory guidelines set forth by OGRA. The process ensures that the refinery meets all operational and environmental standards necessary for continued operation.

1. Application Submission: The application must be submitted as per the format in Part B of Schedule I under the Pakistan Oil Rules, 2016.
2. Required Documents:
   • Refinery Information: Name and address of the refinery and the directors, including their nationality and shareholding details.
   • Registration Documents: Certified true copies of the Certificate of Registration, Memorandum and Articles of Association, and other relevant forms and documents, attested by an authorised person from SECP.
   • Operational Certificates: An EPA clearance certificate and a NOC from the District Government.
   • Crude Oil Source: A letter of support from the source of crude oil.
   • Refinery Configuration: Details of the main units and crude/product storage capacities.
   • Project Costs and Financial Details: Estimated cost of the project, including equity and loans, with due diligence certificates from a scheduled bank.
   • Utilities and Port Facilities: Status of utilities and port facilities.
   • Product Disposal: Proposed arrangements for the disposal of products for local consumption and export, as well as waste management in compliance with NEQS.
   • Emergency Response and HSE: Details of the emergency response system and HSE arrangements.
   • Affidavits from Directors: Affidavits stating the directors’ eligibility and compliance with legal and financial standards.
   • Licence Fee: A licence fee as determined by OGRA.
3. Evaluation and Issuance:
   • OGRA will review the application and conduct inspections to ensure compliance with all operational standards.
   • The authority may require supplementary information or documentation.
   • Upon satisfactory evaluation, a licence will be granted for continued operation.

For assistance with the application process, please contact Josh and Mak International.

(c) Licence for an Oil Refinery Already Under Construction

For oil refineries that are currently under construction, obtaining a licence involves demonstrating compliance with various technical, financial, and environmental standards. Here is a guide to the process:

1. Application Submission: The application must be submitted in the format set out in Part B1 of Schedule I, as per the Pakistan Oil Rules, 2016.
2. Required Documents:
   • Refinery Information: Provide the name of the refinery, and the names and addresses of the directors, including their nationality and shareholding details.
   • Registration Documents: Certified true copies of the Certificate of Registration, Memorandum and Articles of Association, and other relevant forms and documents from SECP.
   • Environmental and Construction Certificates: An EPA clearance certificate and a NOC from the District Government.
   • Crude Oil Source: A letter of support from the source of crude oil.
   • Refinery Configuration: Details of the refinery’s main units and crude/product storage capacities.
   • Financial Details: Estimated cost of the project, including equity and loans, with due diligence certificates from a scheduled bank.
   • Utilities and Port Facilities: Status of utilities at the site and port facilities.
   • Product and Waste Management: Proposed arrangements for the receipt of crude oil, disposal of products, and waste management in accordance with NEQS.
   • Work Program and Emergency Response: Details of the work program, schedule of completion, emergency response system, and HSE arrangements.
   • Affidavits from Directors: Affidavits confirming the directors’ compliance with legal and financial standards.
   • Licence Fee: A licence fee as specified by OGRA.
3. Review and Licensing:
   • OGRA will review the application and may request additional information or conduct inspections.
   • The Authority will evaluate the application for compliance with all regulatory requirements.
   • Upon satisfactory completion of the review, a licence will be granted for the refinery under construction.

For detailed guidance and support, Josh and Mak International is available to assist with the application process.