PESHAWAR - A Memorandum of Understanding (MOU) to establish an oil refinery in Khyber Pakhtunkhwa was signed between the KPK government and Pakistan State Oil (PSO).

A ceremony to this effect was held at Chief Minister Secretariat Peshawar on Thursday. 

Provincial Secretary Energy and Power Zafar Iqbal and Managing Director PSO Naeem Yahya Mir signed the MoU in the presence of KPK Caretaker Chief Minister Justice (Retd) Tariq Pervez Khan and Provincial Minister for Energy and Power Muhammad Younas Khan Marwat.

Addressing the ceremony, the chief minister termed the signing of the MoU historic and important step and said that the project after its completion would play the role of backbone for the economy of the province. He said that it would boost up economic, commercial and industrial activities and create employment opportunities putting the province on the track of development and prosperity.

The CM appreciating the efforts of the energy and power department stressed the need to give the agreement a practical shape in the minimum time period so that the people of the province could soon benefit from it. Earlier, the chief minister was briefed on the project.

According to the MoU, the provincial government will provide 400 acre of land in Kohat on which PSO will install state-of-the-art oil refinery equipped with modern technology.

The project will be completed by the year 2017 with an estimated cost of 700 million US dollars. The refinery will refine 40,000 barrel oil daily.

It is worth mentioning here that at present Khyber Pakhtunkhwa has a production capacity of 28,000 barrels of crude oil which is transported to an oil refinery at Rawalpindi due non-existence of oil refinery in the province.

It resulted with high production cost of petroleum items with the establishment of oil refinery at Kohat the provision of various petroleum products will be ensured locally and thus a good deal of foreign reserve could be saved.

Besides provincial minister for information and public relations Musarrat Qadeem, Senior Member Board of Revenue, Administrative Secretaries of Finance, Planning and Development, industry departments, Managing Director PHYDO, Chief Planning Officer Energy and Power Department. General Manager PSO, Business Manager PSO and other high ups of federal ministry of Petroleum and provincial department of Energy and power attended the ceremony.