KARACHI: Pakistan’s oil marketing companies have asked the government to create a “financially viable” cost-recovery mechanism before requiring the industry to digitize fuel stations nationwide, an initiative expected to exceed Rs50 billion ($178 million) in total investment, the Oil Companies Advisory Council (OCAC) said in a letter shared with Arab News on Wednesday.
The digitization program, centered on installing Auto Tank Gauging (ATG) systems and digital fuel dispensers at all retail outlets, is part of a government push to modernize Pakistan’s fuel-supply chain. ATG systems allow real-time monitoring of underground fuel tanks to curb leakages, theft and misreporting, and are widely used in more regulated markets.
OCAC represents Pakistan’s downstream oil industry and includes both local and foreign firms such as Wafi Energy of Saudi Arabia and Parco Gunvor Limited, a joint venture with Switzerland-based Gunvor Group.
In a letter dated Dec. 2, OCAC Chairman Adil Khattak asked the Oil and Gas Regulatory Authority (OGRA), Pakistan’s federal energy regulator, to finalize how companies will be compensated for the new capital expenditure.
“OCAC strongly urges OGRA to take up the matter in its complete scope and immediately finalize a clear, implementable, and financially viable cost recovery mechanism,” Khattak wrote.
