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Written by: Staff

SINGAPORE, Aug 30 (Reuters) Pakistan's diesel demand is forecast to jump 70 percent in a decade to 15.07 million tonnes, as the overall fuel consumption almost doubles, forcing the country to boost imports, an oil official said on Wednesday.

Total demand for oil, which accounts for 31 percent of the country's energy needs, will grow to 32.51 million tonnes by 2015 and 66.84 million tonnes by 2030, from 16.8 million tonnes last year, said M Adil Khattak, chief executive of Attock Refinery.

To cope with the demand, Pakistan is seeking investments of up to $16 billion for oil-related infrastructure, including refineries, pipelines and storage facilities, he told an oil conference.

But domestic diesel production, even after taking into account three proposed refinery projects, could only yield 10.93 million tonnes a year, a shortfall of more than 4 million tonnes by 2015, he said.

The shortfall of all oil products by 2015 is projected at 30.33 million tonnes, up from 13.18 million tonnes in 2005, he said, adding that the deficit would be covered by imports.

''We need the oil and we need to import. Despite the plans to generate more energy using other means including natural gas and LNG, we still need to import substantial volumes,'' he told Reuters on the sidelines of the conference.

''We will need to import and large volumes at that. And we will need to have the infrastructure in place to cater for the incremental volumes,'' he said, without giving import projections.

Demand for diesel, used for transportation and agriculture, is projected at around 8.88 million tonnes this year, and domestic inventories currently stand at 30 days, well below the required 45 days, Khattak added.

NEW REFINERIES Demand for fuel oil, used mainly for power generation, was also expected to grow at a fast rate, he said, without giving any figures. Most of Pakistan's new power plants are oil-fired thermal units, due to the country's depleting natural gas reserves.

Khattak said part of the incremental demand could be met by supplies from neighbouring India.

''Reliance had been very interested in supplying diesel to the country but it will take some time before that is going to happen. I am sure that it will happen but it would take maybe three to five years,'' he said.

Pakistan is pushing ahead with the development of three refineries, in addition to the existing six with a total refining capacity of 285,500 barrels per day (bpd).

The latest proposal is an oil plant near Karachi with a planned capacity of 250,000 bpd.

The government will invite investors to bid for the project, estimated to cost $1.5-$1.8 billion, in two months and it is expected to be operational in about two years at the earliest, he said, adding that China and Kuwait are among the interested parties.

Another facility, the 100,000-bpd privately funded Indus refinery project, is expected to be ready in about 15 months while the third -- the 120,000-bpd Bosicor project -- has a two-year timeline.

Khattak said the Bosicor project, which will upgrade the existing facility from its 30,000-bpd capacity, is at the process-design stage.


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