Attock Refinery Limited
About Cover Story
Facing upto
Challenges
Attock Refinery Limited (ARL) is the pioneer of crude oil refining in the country with its operations dating back to 1922. Backed by a rich experience of more than 100 years of successful operations, ARL has now grown into a modern state-of-the-art refinery with a name plate capacity of 53,400 barrels per day.
The past three years have seen a series of unprecedented events worldwide including disrupting demand and supply patterns leading to an extremely tight global oil market. The unnerving combinations of a global pandemic compounded by energy scarcity, rapid inflation, geopolitical tensions etc. have all created new challenges around us.
After a sharp collapse in oil demand due to the COVID-19 pandemic, a stronger-than- expected demand rebound came
due to the Russian - Ukraine conflict and the subsequent sanctions on Russian crude and product created new challenges for world economies and Pakistan is no exception.
Pakistan business environment during the recent past has remained very challenging and volatile especially for Oil Refining Sector. Factors like stringent environmental regulations, reliance on alternate sources of energy, economic recession, smuggling from neighbouring countries and political instability has added to the difficulties of refineries.
Since past few years, there was a major shift in the Government policy for power generation from furnace oil to alternate fuels. The aftermath of this decision has left limited choices for Refining sector. Refineries have to either store
the product during lean periods or export the surplus quantity. To cater for this challenge, ARL has initiated process to acquire dedicated FFO storage facility at Port Qasim, Karachi in order to enhance its operational flexibility.
The whole industry including ARL has been struggling with the menace of smuggling of petroleum products from the neighbouring countries which have seriously impacted product uplifting especially High Speed Diesel. ARL remained engaged with the relevant regulatory authorities to perform their vigilant role in curbing this menace, which is not only causing revenue losses to the Government but also damaging the local industry.
The crude supplies to ARL from northern fields have declined to a level of 40,000 BPSD. In order
Annual Report 2023
to augment capacity utilization of our Refinery, ARL pursued Government for allocation of crude from southern oilfields and its freight reimbursement from country IFEM Pool. The matter has been recently approved
by Economic Coordination Committee (ECC) of Cabinet thus paying way for getting the around 5,000 bpd supplies of crude from southern oil fields in near future. This crude allocation will not only help ARL to operate at optimum capacity but will also result in saving of precious foreign exchange and additional freight savings to Government of Pakistan.
Due to sharp decline of country's foreign exchange reserves, ARL along with other industries faced serious challenge for opening/ retiring of Letter of credits (LCs). However, with the help of different state institutions including
Ministry of Energy (Petroleum Division)-MEPD, Oil Gas Regulatory Authority (OGRA) and State Bank Pakistan (SBP) ARL was able to ensure continuity of critical supply chain. Besides, ARL alongwith other foreign companies have been facing challenges in repatriation of dividend payments to their shareholders due to restrictions on foreign exchange payments for the last one year. We expect from relevant authorities to resolve this issue to keep the faith of foreign investors especially in capital intensive industries like refineries.
ARL in collaboration with other local refineries has been continuously emphasizing the need for a comprehensive and vibrant Refining Policy as the Refining Policy was last revised in 1997. After continuous following up with MEPD, the Refining Policy for brownfield refinery projects
has been finally approved and is expected to provide solace to the complicated challenges of today's refining sector in Pakistan. With approval of the Refining Policy 2023, ARL will be undertaking a major upgradation project for value addition.
Amidst continuously evolving challenges and rapidly changing economic environment, ARL is not only facing upto daunting challenges but also striving to turn these into opportunities for a promising future. We shall continue to work for sustainability of our existing operations by taking proactive strategic decisions with collective wisdom and to up-grade our facilities to meet the future challenges.
Attock Refinery Limited
Annual Report 2023
TABLE OF CONTENTS
04 | Honors & Achievements | 74 | Audit Committee Report | 113 | Financial Highlights of AHL |
06 | Company Profile | 76 | Pattern of Shareholding | 114 | Statement of Free Cash Flow |
07 | Accreditation & Certifications | 114 | Dupont Analysis | ||
08 | Series of Firsts & Major Events | Strategy and Resource Allocation | 115 | Analysis of Quarterly Variation | |
78 | Strategic Plan | ||||
Organisational Overview and | 79 | Resource Allocation Plan | Compliance with Code of | ||
External Environment | Corporate Governance | ||||
10 | Principal Business Activities | Risk and Opportunities | 116 | Statement of Compliance | |
and Markets | 82 | Risk and Opportunities | 119 | Independent Auditor's Review Report | |
11 | Key Brands and Products | 84 | Liquidity Strategy | ||
12 | Geographical Presence of ARL's | 84 | Capital Structure | Financial Statements | |
Business | 123 | Independent Auditor's Report | |||
14 | Vision and Mission | Corporate Social Responsibility | to the Members | ||
15 | Core Values | 86 | Corporate Social Responsibility | 128 | Statement of Financial Position |
16 | Code of Conduct | 130 | Statement of Profit or Loss | ||
22 | Group Structure | Future Outlook | 131 | Statement of Profit or Loss and Other | |
23 | Organogram | 92 | Future Outlook | Comprehensive Income | |
24 | Company's Products Value Chain | 132 | Statement of Changes in Equity | ||
25 | Pestel Analysis | Information Technology Governance | 133 | Statement of Cash Flows | |
26 | Competitive Landscape and | 93 | Information Technology Governance | 134 | Notes to and Forming Part of the |
Market Positioning | Financial Statements | ||||
26 | Significant Changes from Prior Years | Stakeholders Engagement | |||
27 | SWOT Analysis | 94 | Stakeholders Engagement | Consolidated Financial Statements | |
27 | Calendar of Major Events | 185 | Independent Auditor's Report | ||
Analysis of Financial Information | to the Members | ||||
Governance | 98 | Financial Statistical Summary | 190 | Consolidated Statement of | |
28 | Board of Directors | 100 | Financial Highlights | Financial Position | |
34 | Board Committees | 103 | Share Price Sensitivity Analysis | 192 | Consolidated Statement of |
35 | Company Information | 104 | Analysis of Financial Statements | Profit or Loss | |
36 | The Management | 105 | Composition of Statement of | 193 | Consolidated Statement of Profit or |
38 | Management Committees | Financial Position | Loss and Other Comprehensive Income | ||
40 | Chairman's Review | 105 | Segmental Review of Business | 194 | Consolidated Statement of Changes |
42 | Directors' Report | Performance | in Equity | ||
58 | HSEQ Policy | 106 | Statement of Value Addition | 195 | Consolidated Statement of Cash Flows |
59 | Energy Policy | 106 | Statement of Charity Account | 196 | Notes to and Forming Part of the |
60 | Human Resource Policy | 108 | Vertical Analysis | Consolidated Financial Statements | |
62 | Whistle Blowing Policy | 110 | Horizontal Analysis | ||
63 | Gender Diversity Policy | 112 | Statement of Contribution & | Notice of AGM & Proxy Form | |
65 | Code of Conduct for Protection against | Value Addition | 247 | Notice of Annual General Meeting | |
Harassment at Workplace | 251 | Ballot Paper | |||
67 | Business Process Re-Engineering | 267 | |||
Research & Development | 268 | Glossary | |||
70 | Other Corporate Governance | 269 | Proxy Form | ||
271 | Proxy Form (in Urdu) |
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Attock Refinery Limited published this content on 18 September 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 18 September 2023 06:19:06 UTC.