Research Analyst
11 - 17, 2011

National refinery limited (NRL) is engaged in the manufacturing and supplying of a range of fuel products, lubes, benzene, toluene, xylene (BTX), asphalts and specialty products for domestic consumption. The company operates in two business segments: fuel and lube. The fuel segment supplies fuel products and offers gasoline, diesel oils, kerosene, and furnace oil. The lube segment provides various types of lube base oils, asphalt, wax free oil and other petroleum products.

The refinery complex of the company comprises three refineries including two lube refineries and a fuel refinery. In June 2003, the government of Pakistan decided to include NRL in its privatization programme. The selling of 51 per cent equity and transfer of management control to a strategic investor had been proposed accordingly, the due diligence process for the privatization was initiated. After competitive bidding NRL was acquired by Attock Oil Group in July 2005. The company has been privatized and the management handed over to the new owner (Attock Oil Group) on July 7, 2005.

NRL's plants have a fuel refining capacity of 2,710,500 tones per annum (TPA) of crude oil, two lube refineries with a combined designed capacity of 176,200 TPA of lube base oils (LBO) and a BTX unit with a designed capacity of 25,000 TPA. First Lube Refinery was designed and constructed by SNAM PROGETTI of Italy with a capacity to process 539,700 TPA of crude oil and to produce 76,200 TPA of LBO. It was commissioned in June 1966.

This refinery also produces fuels, asphalt and specialty oils. Fuel Refinery was designed and constructed by Industrial Export Import (IEI) of Romania with a capacity to process 1,500,000 TPA of crude Oil and was commissioned in April 1977. Its capacity was increased to 2,170,800 TPA in February 1990. The fuel products consist of LPG, motor gasoline, kerosene, jet fuels, diesel and furnace oil. Second Lube Refinery was designed by CE Lummus of UK and constructed by Industrial Export Import (IEI) of Romania and was commissioned in January 1985. It has a designed capacity of 100,000 TPA of LBO and 110,000 TPA of Asphalt. Furthermore, BTX (Petrochemical) Plant was designed and constructed by Nordon et Cie of France with a capacity to produce 25,000 TPA of BTX and was commissioned in April 1979. It was the country's first petrochemical unit. This plant produces Benzene, Toluene and Xylene for the specialty chemicals market. Toluene is also used in NRL's own Dewaxing units.

NRL's gross storage capacity, both at the refinery site in Korangi and at Keamari harbour, comprises about 163,000 tones (20 days) for crude and 90,000 tones for petroleum products. The petroleum products are pumped from NRL storage tanks to oil marketing company (OMC) terminals or to Karachi airport by pipelines. Other products such as lube base oils, asphalt, chemicals (BTX) are transported through Tank Lorries.

2006 3,410
2007 4,203
2008 6,005
2009 1,533
2010 3,285


This year has witnessed a marginal recovery in global economy led by growth in developing nations. Despite various odds, macroeconomics environment has improved. Unfortunately, due to recent floods economy in the year 2010-11 has been fragile because of destruction of some infrastructure and agriculture sector. NRL continued to face liquidity crunch due to circular debts, whereas material steps from the government are still awaited to resolve the issue. The company has earned a net profit after tax of Rs3,285 million as compared to Rs1,533 million in the last year. Earning per share is Rs41.08 compared to Rs19.17 in the last year. The loss in fuel segment of Rs707 million has been transferred to special reserve as per the pricing formula. An amount of Rs4,025 million is available for appropriation. Lube Segment earned profit after tax of Rs3,992 million as compared to Rs4,232 million in the last year. The reduction in profitability was due to higher feed cost compared to selling prices of Lube Base Oils, determined on the basis of market dynamics.

The company has achieved sales of Lube Base Oils of 206,045 million tons that is higher by 32,169 million tons compared to last year. During the financial year, the company contributed Rs28,103 million to the national exchequer in the shape of direct and indirect taxes and earned valuable foreign exchange of $212 million through the export of naphtha and lube base oil.

The company has long-term credit rating of "AAA" due to exceptionally strong capacity for timely payment and short-term rating "A1+" due to obligations supported by the highest capacity for timely repayment. Credit rating assessments have been carried out by Pakistan Credit Rating Agency (PACRA).


The fuel refineries of the country for the last two years are continuously facing losses mainly due to the pricing formula. Refineries including NRL pursued government on the matter, which is now being actively considered. It is expected that appropriate revisions in the pricing formula would be made to protect the refineries and encourage the investment in refining sector of Pakistan. NRL objectives and development strategy are aimed at achieving sustainable productivity and profitability and high standards of safety, occupational health and environmental care.