Pakistan and Saudi Arabia strengthen energy ties with new oil storage plans
The two countries also discussed crude oil purchases and investment in the minerals sector to strengthen their economic relationship. Meanwhile, Saudi Arabia has introduced same-day visa processing for Pakistani citizens at its embassy in Islamabad.
New opportunities for oil storage
The agreements were discussed during a meeting between Federal Minister for Petroleum Ali Pervaiz Malik and Saudi Arabia’s Ambassador to Pakistan, Dr Rajeh bin Tami Al-Baqami. Both sides explored ways to increase cooperation in petroleum, energy and mining projects.
Pakistan wants to increase its storage capacity for crude oil and refined petroleum products to improve energy security. The country currently has no strategic petroleum reserves, making it vulnerable to disruptions in international oil supplies.
The minister said Pakistan had approved a tax-neutral bonded policy based on international energy trading centres such as Fujairah and Singapore. Under this policy, Saudi companies will be able to store commercial oil reserves in Pakistan without facing local tax liabilities.
“Under this framework, Saudi companies can establish commercial oil reserves in Pakistan without local tax liabilities, offering an opportunity to diversify maritime transit risks associated with the Strait of Hormuz and Bab al-Mandab while facilitating access to Asian markets,” the statement said.
“The petroleum minister highlighted that strategic oil storage facilities in Pakistan would provide Saudi Arabia with greater flexibility in managing supply routes and accessing regional markets,” it added.
Major petroleum project planned in Balochistan
Pakistan is also planning to establish a large petroleum storage and refining complex at Hub in Balochistan. The project is expected to be developed under the guidance of Technip Energies UK.
“The proposed facility, supported by the prime minister and the chief of defence forces, will have the capacity to accommodate Very Large Crude Carriers (VLCCs) and strengthen Pakistan’s potential as a regional energy corridor serving Central Asian and Chinese markets,” the statement quoted Malik as saying.
The proposed facility could help Pakistan handle large oil shipments and improve its position as a regional energy supply centre. It could also provide better access to markets in Central Asia and China.
Saudi investment in refinery upgrades and LPG supplies
The petroleum minister also discussed investment opportunities under Pakistan’s refinery upgradation programme. The programme aims to modernise local refineries, improve their performance and introduce cleaner Euro-5 fuel standards.
Malik said Saudi companies could play an important role in upgrading Pakistan’s refining industry through investment and technical cooperation. He also thanked Saudi Arabia for supporting Pakistan during recent disruptions in international oil markets.
The minister appreciated the efforts of Saudi authorities at Yanbu port for giving priority to crude oil shipments destined for Pakistan. He also discussed cooperation with Saudi Aramco to increase crude oil purchases and arrange dedicated LPG shipments.
These supplies are particularly important because Pakistan expects domestic gas demand to increase during winter. Additional LPG shipments could help meet the country's energy requirements.
Same-day Saudi visa processing for Pakistanis
Saudi Arabia also announced same-day processing of visa applications for Pakistani citizens at its embassy in Islamabad. The new facility is intended to make travel easier and encourage stronger business and social connections between the two countries.
Both sides said their strong defence and strategic relationship could support wider economic cooperation, regional peace and stability. The Saudi ambassador also appreciated Pakistan’s long-standing support and said the two countries would continue standing together in difficult circumstances.
He added that their defence and energy cooperation could help promote economic growth and stability across the region.
The latest developments could open new opportunities for Pakistan to attract Saudi investment in its energy sector. Better oil storage facilities and upgraded refineries could also reduce the country's dependence on immediate international fuel supplies.
However, the success of these plans will depend on investment, timely project completion and practical cooperation between both countries. Same-day visa processing is another positive step that could make travel and business activities easier for Pakistanis.
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