KARACHI: Hascol Petroleum has planned to set up another wholly-owned subsidiary Hascol Lubricant at a cost of $ 20 million. The subsidiary will operate the plant that will produce various brands of lubricants.
According to the company’s stock filing, the subsidiary will operate Hascol’s Lube Blending and Grease Plant, which is to be set up within the next two years. The company has already acquired land measuring approximately six acres at Port Qasim for the blending plant, in collaboration with FUCHS-Germany.
Forming a separate subsidiary was a strategic decision of the company that was undertaken in order to avail tax break benefits under the Income Tax Ordinance 2001.
The management of Hascol Petroleum Limited will hold a ceremony on February 20 in this regard.
The production of lubricants and different petroleum products is expected to boost the business of Hascol Petroleum.
Moreover, Hascol Petroleum Limited’s Mehmood Kot Installation has been fully completed for the uplifting of petroleum products. The installation has been constructed on approximately 6 acres and is designed to cater to a total capacity of 13,500 metric tons of petroleum products including 9,000 metric tons of high speed diesel and 4,500 metric tons of motor gasoline and is connected to the PARCO Pipeline, said company secretary Zeeshan UI Haq.
The commissioning of Mehmood Kot Installation will improve our supply chain management in Southern Punjab and will lead to an increase in company’s sales of diesel and gasoline, added Haq.
Hascol Petroleum Limited is one of the growing companies in Pakistan in terms of operations and profit. In November 2016, the Oil Marketing Company (OMC) was approached by UAE-Based Energy Group, Vitol Dubai Limited, to buy 10 percent shares of Hascol Petroleum Limited, which will increase its overall shareholding in the Pakistani Oil Marketing Company from 15 percent to 25 percent.
In February 2016, Dubai Vitol bough a 15 percent stake in Hascol Petroleum Limited at a cost of $ 28.1 million, which is equal to 18.1 million shares of the company at a price of Rs 162 per share.
The transaction of the new shares will be culminated by the end of February 2017 with possible inflows of nearly $20 million in FDI in Pakistan, which are likely to be used for the establishment of a subsidiary named Hascol Lubricant (Pvt) Limited.