Islamabad - Pakistan State Oil plans to set up two oil storages having the capacity of 18500 metric tonnes for the Motor Gasoline at two different points in Karachi.

“A summary for the purpose would be placed before the Economic Coordination Committee of the Cabinet,” official sources told The Nation here on Wednesday. The sources added that both the storages would be connected through a pipeline.

Giving further details, they said that both these storages would be built by PSO, as a state-owned oil company is responsible for maintaining its all storages to cater for the country’s needs.

Under the law, Oil Marketing Companies (OMCs) are bound to keep at least 20 days stock, but in January 2015 due to these companies failure to maintain the petrol stock  worst oil crisis was witnessed in the country.

During January oil crisis, OGRA blamed 10 OMCs for violating terms of their licences, since as per Pakistan’s petroleum rules, the OMCs are bound to maintain stocks for 20 days.

Pakistan State Oil, Shell, Chevron, Bakri, Admore, Askar, Attock Petroleum, Overseas Pakistan and Byco Petroleum Limited were held responsible for not maintaining stocks.

To avert such crisis in future, the government is urging the OMCs to enhance their storage capacity. The Ministry of Petroleum and Natural Resources is working on increasing the national strategic oil reserves, and has recently requested the federal government to provide Rs10 billion for the purpose. National strategic oil storages cater for fuel requirements of armed forces in emergencies such as war, floods and earthquakes.

Strategic stocks are permanently held for non-commercial reasons and are used as a safeguard against external blockades in times of war.

The reserves also provide a safeguard against natural disasters and pipeline breakdowns etc.

The consumption of Motor Gasoline has grown by around 20 percent in the last five years, and currently around 5 million tonnes of Gasoline is being consumed annually in Pakistan.

Out of the total consumption, 3.5 million tonnes is being imported while the remaining 1.5 million tonnes is being produced at local refineries.

Besides, Hascol Petroleum has already announced that the company, in partnership with Dubai-based Vitol, will set up 200,000 tonnes oil storage facility at Port Qasim.