British energy giant seeks to acquire Shell Pakistan amid reports of Saudi interest

A Shell logo is pictured on a sign outside a Royal Dutch Shell petrol station in Gateshead, north east England on January 31, 2023. (AFP/File)
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Updated 17 October 2023
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British energy giant seeks to acquire Shell Pakistan amid reports of Saudi interest

  • Shell Petroleum announced its exit from Pakistan in June with sale of 77 percent shareholding in local business
  • Analysts say deal value, depending on assets involved, market, negotiation terms, would be in $200 million range

KARACHI: As a British energy giant seeks to acquire stakes in Shell Pakistan (SPL) in a potential $200 million deal, financial experts said on Tuesday the entry of credible international players was important for Pakistan’s corporate ecosystem. 

Shell Petroleum Company announced its exit from Pakistan in June with the sale of its 77 percent shareholding in the local business. The move came after Shell made several announcements about its global operations and after Shell Pakistan (SPL) suffered losses in 2022 due to exchange rates, the devaluation of the Pakistani rupee, and overdue receivables, and as the country faces a financial crisis and economic slowdown.

The offloading of shares also includes all of SPL’s downstream businesses and SPL’s 26 percent ownership of Pak-Arab Pipeline Company Ltd. (PAPCO). Shell Pakistan is a listed company with market capitalization of over Rs34.35 billion ($124.5 million). 

Since the announcement, State-owned Pakistan Refinery Limited and Air Link Communication, a local firm, have both said they were seeking to buy stakes in Shell Pakistan. Interest by Saudi buyers has also been widely reported.

However, SPL announced in a stock filing on Monday that it had received “firm intention” from Prax Overseas Holdings Limited to acquire control or 165,700,304 (up to 77.42 percent) voting shares. The acquirer, the listing said, was also looking to secure an extra 11.29 percent or 24.16 million shares through a public offer. 

Britain’s Prax Overseas Holdings, an investment company, is part of the Prax Group, headquartered in London with interests in exploration and production, refining, logistics, and integrated supply and optimization. 

Pakisani analysts called the Prax interest in Shell Pakistan “an interesting development” that would have positive implications for Pakistan’s energy sector and the overall economy. 

“Having another foreign company invest in the country can bring in new capital, technology, and expertise, potentially boosting the energy sector’s efficiency and competitiveness,” Ali Nawaz, CEO of brokerage firm Chase Securities, told Arab News.

Nawaz estimated that a possible deal value, depending on various factors such as the assets involved, market conditions, and negotiation terms, would in the range of $170 million to $200 million.

The SPL has recently also received interest from Saudi companies including oil giant Aramco and Wafi Energy, a leading fuel station firm, according to SPL officials privy to the issue, who did not want to be named.

“The parent company, SPC, is directly dealing with potential buyers and will set the scheduled for due diligence of the company,” an SPL official, requesting anonymity, told Arab News on Monday. 

Financial experts said it was important for Pakistan’s “corporate ecosystem” that the buyer was a credible operator who had the ability to maintain standards set by Shell. 

“This is why the news about potential interest by Aramco gained so much public interest. There is optimism and expectations in Pakistan about the prospects of foreign investment from Saudi Arabia,” Ali Fareed Khwaja, chairman of KTrade, a Pakistan and UK based brokerage firm, told Arab News. 

“Consequently, I think that the market would react more positively for a Middle Eastern group buying Shell rather than a British holding company. There are also some fears that the multinationals are pulling out and would be replaced by local investors.”

However, Nawas said it was essential to consider any buyer’s track record in the industry, commitment to sustainable practices, and the potential benefits they can bring to the local economy. 

“When comparing [UK company] with Saudi interests, it becomes a matter of geopolitical and economic considerations,” Nawaz added.

“Both Prax and Saudi interests could bring unique advantages, and the choice might hinge on the alignment of the buyer’s vision with Pakistan’s long-term goals and interests.”


Pakistan government hopes for calm as Imran Khan’s party claims eight dead in Islamabad clashes

Updated 15 sec ago
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Pakistan government hopes for calm as Imran Khan’s party claims eight dead in Islamabad clashes

  • PTI workers retreated from the capital where they planned a sit-in after police, paramilitary launched operation
  • Interior minister says Khan’s wife and KP chief minister are ‘on the run,’ with PTI not sharing their status

ISLAMABAD: Pakistan’s Interior Minister Mohsin Naqvi voiced optimism for normalcy in Islamabad early Wednesday as former Prime Minister Imran Khan’s supporters withdrew following intense clashes with police and paramilitary Rangers, with his party claiming at least eight protesters were killed.
The unrest unfolded as police and Rangers launched an operation to disperse Pakistan Tehreek-e-Insaf (PTI) protesters who aimed to stage a sit-in near parliament and key government installations, demanding the release of Khan, who has been in prison for over a year.
Led by Khan’s wife, Bushra Bibi, and Khyber Pakhtunkhwa Chief Minister, Ali Amin Gandapur, the protest march began on November 24 with a “final call” by the ex-premier to his supporters, with many of them vowing not return until Khan was freed.
Speaking to the media, Naqvi said the protesters had fled, adding that Bibi and Gandapur were also “on the run.”
“You saw them fleeing— thousands, not just one or two or three,” he said, referring to the protesters.
“For us, the most important thing is to restore all the roads in Islamabad that were blocked. Reopen mobile phone and Internet services. By tomorrow, you will find the roads operational,” he added.
Naqvi praised the Rangers for their “amazing performance” and urged Khan’s party to reconsider its approach.
“How many times do you intend to repeat such actions,” he asked. “Please, stop now. Today alone, the stock exchange dropped by 3,500 points. Hopefully, tomorrow will bring a new day with a fresh perspective.”
In a separate news conference, Information Minister Attaullah Tarar accused the PTI of suffering a “major political failure,” saying their leaders came to free Khan but ended up with many of their workers arrested.
“This wasn’t a final call,” Tarar remarked. “It was a missed call.”
“This has become a major political failure for them because their intentions were not right,” he continued. “They have suffered significant losses and will not be able to recover from this.” 
Tarar further alleged that PTI’s protest aimed to disrupt the visit of Belarusian President Alexander Lukashenko, who is on a three-day visit to Islamabad, and damage the country’s economy.
“Their schemes have been reduced to dust,” he added.
PTI Alleges ‘Massacre’
Meanwhile, PTI accused the government of using excessive force against its supporters. In a strongly worded social media post, the party described the crackdown as a “massacre” by the state.
“A massacre has unfolded in Pakistan at the hands of security forces... firing live rounds with the intent to kill as many people as possible. Pakistan is experiencing its darkest hour since the massacre in East Pakistan in 1971,” the party wrote.
The PTI claimed “dozens” of its supporters were killed in a separate statement, adding it had identified eight victims so far.
In an appeal to the Chief Justice of Pakistan, the party called for suo motu action and murder charges against Prime Minister Shehbaz Sharif, the interior minister, and police chiefs in Islamabad and Punjab.
“Dozens of unarmed and innocent workers were shot dead on the orders of the fascist regime,” the PTI said in its statement.
It added that the party planned to review the situation with its leadership, including Khan, to decide on its next steps.
None of the PTI statements share the current status and location of Bibi and Gandapur.
A day earlier, Amnesty International urged the Pakistan government to ensure the rights of protesters and rescind alleged “shoot-on-sight” orders.
“The severe restrictions on assembly, movement, and mobile and Internet services, as well as arbitrary detentions of thousands of protesters across Pakistan, particularly in Islamabad, are a grave violation of the rights to freedom of peaceful assembly, movement, and expression,” the organization said on X, formerly Twitter.


Threats from Middle East conflict affecting Pakistan maritime security needs — naval chief

Updated 27 min 52 sec ago
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Threats from Middle East conflict affecting Pakistan maritime security needs — naval chief

  • Says Iran’s standoff with US and Israel may manifest into “precarious situation” for ships plying along Sea Lines of Communication
  • Pakistan has recently inducted PNS Babur and PNS Hunain, two state-of-the-art warships, into its fleet to enhance maritime security 

KARACHI: Pakistani Naval Chief Admiral Naveed Ashraf said this week growing regional threats due to the conflict in the Middle East had necessitated a “robust, adaptive, and technologically advanced” navy and pushed Islamabad to reevaluate its maritime security needs. 

Pakistan has recently inducted PNS Babur and PNS Hunain, two state-of-the-art warships, into its fleet as part of a broader effort to enhance its maritime security and operational readiness. 

In an interview with the Naval News website, Admiral Ashraf explained the effects on naval technologies of a changing regional geopolitical environment due to the “ongoing Israel-Gaza conflict with its butterfly effect in Yemen and Iran.”

“The already volatile maritime security environment coupled with a diverse range of traditional and non-traditional maritime threats necessitates a robust, adaptive, and technologically advanced Navy with well-trained HR,” he said.

“Therefore, since assuming command as Chief of the Naval Staff, the most pressing challenge was to boost combat readiness through optimal utilization of resources and completion of ongoing Projects under financial constraints in order to boost the Pakistan Navy’s prowess in the increasingly complex maritime security environment in the region.”

Admiral Ashraf said Pakistan was in the midst of complex geo-political and geo-economic competition prevailing in the region and its maritime security was intertwined with the maritime environment in the Indian Ocean, which was rapidly transforming. 

“In our immediate neighborhood, long-drawn instability in Afghanistan simmers and continues to impinge upon regional security. On our eastern side, India is disturbing regional peace by blatantly provoking its neighbors,” the officer said. 

“On our Western flank, Iran’s standoff with the US and Israel may manifest into a precarious situation for the shipping plying along the international Sea Lines of Communication (SLOCs).”

The ongoing Israel-Hamas conflict, with a spillover in the maritime arena after missile strikes by Houthis on merchant traffic and counter strikes on the Yemen mainland by the US-led West, had created conditions for enhanced ERF presence in the region, Ashraf said, referring to Engine Reliability Fix (ERF), a Naval Aviation Enterprise initiative that aims to improve the lifespan of engines on various aviation platforms.

“Access to shore-based missiles and remotely operated vehicles to the warring groups is a serious threat to SLOCs transiting the Red Sea and the Gulf of Aden,” he added. 

In the non-traditional domain, maritime terrorism, piracy, drug trafficking, gun running and human smuggling were other challenges, Admiral Ashraf said, describing Pakistan’s regional maritime security as an “ominous hybrid mix of traditional and non-traditional threats.”

“Operationally, we believe in hybrid approach that combines manned and unmanned systems for naval operations,” he added. 

“This strategy enables us to leverage the strengths of both types of platforms, optimizing operational flexibility and effectiveness. By integrating unmanned technologies with traditional manned systems, what I have observed is that operational gaps have been duly addressed, especially with regards to surveillance while substantially cutting repair/ maintenance and operating costs.”


Pakistan says over 24,000 Hajj applications received so far for 2025 pilgrimage 

Updated 37 min 46 sec ago
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Pakistan says over 24,000 Hajj applications received so far for 2025 pilgrimage 

  • Saudi Arabia has allotted Pakistan a total quota of 179,210 pilgrims for the upcoming Hajj pilgrimage
  • Quota of 5,000 has been allocated this year for overseas Pakistanis on “first-come-first-served basis”

ISLAMABAD: Over 24,000 Hajj applications by Pakistani pilgrims had been received by designated banks by Tuesday, Radio Pakistan reported, as the nation prepares for the annual pilgrimage slated to be held in June next year.

Saudi Arabia has allotted Pakistan a total quota of 179,210 pilgrims for the upcoming Hajj pilgrimage, to be divided equally between the government and private schemes. Around 15 designated Pakistani banks started receiving applications for Hajj 2025 from intending pilgrims on Monday this week. 

The deadline to file Hajj applications is Dec. 3 while the draw for the government scheme will be held on Dec. 6.

“Receiving Hajj applications under the Government Scheme, through designated banks, is gaining momentum,” Radio Pakistan reported.

“Today, four thousand Hajj applications were received, bringing the tally to twenty-four thousand, two hundred and sixty-six.”

A quota of 5,000 has been allocated for overseas Pakistanis on a “first-come-first-served basis,” the religious affairs ministry said on Monday. 

The ministry announced the country’s Hajj 2025 policy earlier this month, according to which pilgrims can pay fees for the annual pilgrimage in installments for the first time.

Under the government scheme, the first installment of Hajj dues, amounting to Rs200,000 ($717), has to be deposited along with the Hajj application, while a second installment of Rs400,000 ($1,435) must be deposited within ten days of the balloting. The remaining amount has to be deposited by Feb. 10 next year.

On Sunday, Pakistan’s religious affairs ministry said it had launched the “Pak Hajj 2025” mobile application to guide and facilitate pilgrims. The app is available for both Android and iPhone users.


Ex-PM Imran Khan party says wife, key aide not under arrest as Pakistan launches ‘operation’

Updated 26 November 2024
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Ex-PM Imran Khan party says wife, key aide not under arrest as Pakistan launches ‘operation’

  • Local media widely reported vehicles carrying Bushra Khan and Gandapur left Islamabad and entered Khyber Pakhtunkhwa
  • Interior minister says PM has ruled out talks with protesters demanding ex-PM Imran Khan’s release, six including four troops killed

ISLAMABAD: A spokesperson for jailed ex-premier Imran Khan said on Tuesday Bushra Khan, the former PM’s wife, and key party leader Ali Amin Gandapur, who were leading demonstrations in Islamabad to demand Khan’s release, had left a protest caravan but were safe amid widespread media reports they had been arrested.

At least six people, including four paramilitary soldiers and two protesters, were killed during clashes between security forces and protesters who made it on Monday night to the edge of Islamabad’s highly fortified red zone, home to key government and diplomatic buildings, before being pushed back by hundreds of security forces, according to Khan’s Pakistan Tehreek-e-Insaf (PTI) party. 

“We are trying to secure Bushra Bibi and Ali Amin for the next few hours because we have credible sources that the law enforcement plans to arrest them with a heavy hand,” Sayed Zulfikar Abbas Bukhari, a spokesman for the PTI party told Arab News when asked if Bushra and Gandapur had left the protest caravan. He confirmed they had not been arrested. 

Bukhari declined to disclose where the two protest leaders were but confirmed that their protest caravan, which was nearing the D-Chowk public square in the red zone, had been pushed further back to the capital’s Chongi 26 area by “hundreds” of security officials. 

Two security officials, declining to be named, told Arab News an “operation” had been launched against the PTI protest, declining further details.

Pakistani local media widely reported that police chased cars carrying Bushra and Gandapur, but their vehicles entered Khyber Pakhtunkhwa, a northwestern province where PTI is in power and where the federal government does not have jurisdiction. 

Supporters of Khan’s PTI on Tuesday reached D-Chowk for a “do or die” sit-in that they say will go on until Khan is freed from prison. 

The former premier has been jailed since August last year and faces a slew of charges from corruption to terrorism that he says are politically motivated to keep him behind bars and away from politics. 

Speaking to reporters, Interior Minister Mohsin Naqvi ruled out talks with protesters. 

“In today’s meeting, the clear-cut decision of the prime minister and others is that there will be no talks with these protesters,” Naqvi said after Prime Minister Shehbaz Sharif met his cabinet and other top officials on Tuesday evening. 

Information Minister Ataullah Tarar said the government had agreed to offer the protesters space on the outskirts of Islamabad to hold their protest and would have facilitated them in their activities. 

“But why do they want to go to D-Chowk?” the information minister asked. “Because they want to cause damage to the life and property of Islamabad’s citizens. They have among them Afghan nationals, terrorists, dacoits.” 

In a message shared with supporters from jail by his team, Khan, 72, urged his followers to stay peaceful but to stand firm till the end. 

“My message for my team is to fight until the last ball is bowled. We will not back down until our demands are met!”

LOCKDOWN

As thousands of rally goers left for Islamabad on Sunday in protest caravans, authorities shut down major highways leading to the capital and used shipping containers to block major roads and streets inside the city. Mobile Internet links and apps like WhatsApp have been down since the weekend and schools have been closed for several days in the capital and the nearby garrison city of Rawalpindi. 

Last week, the district administration also banned public gatherings in Islamabad for two months, and on Monday, the interior ministry invoked Article 245, calling in the army to maintain law and order. 

On Tuesday afternoon, protest leader Ali Amin Gandapur urged protesters to camp at the D-Chowk square and not advance further into the red zone. 

“D-Chowk means D-Chowk,” the chief minister told supporters from atop a truck en route to the public square. “Beyond that, as long as Imran Khan’s orders, Imran Khan’s instructions are not given, we will not go beyond that area and we will respect his instructions.”

Amnesty International called on the Pakistan government to protect and ensure the rights of protesters and “immediately rescind the ‘shoot-on-sight’ orders that provide undue and excessive powers to the military.”

“The severe restrictions on assembly, movement and mobile and Internet services as well as arbitrary detentions of thousands of protesters across Pakistan, particularly in Islamabad, are a grave violation of the rights to freedom of peaceful assembly, movement and expression,” the rights group said on X.


Pakistan urges World Bank support on economic reforms, development agenda

Updated 26 November 2024
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Pakistan urges World Bank support on economic reforms, development agenda

  • IMF approved a $7 billion bailout loan for Pakistan in September that comes with a tough economic reforms agenda
  • IMF is pushing Pakistan to continue prudent fiscal and monetary policies, mobilize revenue from untapped tax bases

ISLAMABAD: Minister for Finance Muhammad Aurangzeb met World Bank Country Director Najy Benhassine on Tuesday and urged the international lender to support Pakistan in its economic reforms and development agenda, Radio Pakistan reported. 

The talks in Islamabad came less than two months after the IMF approved a $7 billion bailout loan for Pakistan that is attached to tough economic reforms. The IMF is pushing Pakistan to continue prudent fiscal and monetary policies, and to mobilize revenue from untapped tax bases.

Pakistan’s $350 billion economy has struggled for decades with boom-and-bust cycles, needing 23 IMF bailouts since 1958.

“During the meeting, the Finance Minister highlighted the importance of collaboration with the World Bank to support Pakistan’s economic reforms and development agenda,” Radio Pakistan reported. “The Finance Minister reiterated the government’s commitment to fiscal discipline, sustainable growth, and efficient resource utilization.”

The discussions focused on the establishment of a robust and transparent tax policy framework to enhance revenue mobilization and improve compliance while ensuring equitable taxation, the report said. 

The World Bank team also offered technical assistance to streamline the budget-making process, adopt modern practices to improve transparency and accountability in public financial management, and put in place an effective debt management mechanism to ensure fiscal sustainability and reduce risks.

Issues related to the Agricultural Income Tax Regime and GST harmonization in coordination with provinces and an enhanced focus on the active role of the National Tax Council also came under discussion.

“The Finance Minister expressed gratitude for the World Bank’s support and reaffirmed the government’s resolve to implement reforms aimed at sustainable economic progress,” the reported said, adding that the World Bank officials reiterated the lender’s commitment to assisting Pakistan in addressing economic challenges and achieving its developmental objectives.

The IMF, which approved the new bailout in September, has said the program will require “sound policies and reforms” to strengthen macroeconomic stability and address structural challenges alongside “continued strong financial support from Pakistan’s development and bilateral partners.”

The IMF said in its statement on approving the loan that Pakistan had taken key steps to restore economic stability with consistent policy implementation under the 2023-24 standby arrangement.

It added that growth had rebounded to 2.4 percent and inflation has receded significantly, falling to single digits, amid appropriately tight fiscal and monetary policies.

A contained current account and calm foreign exchange market conditions have allowed the rebuilding of reserve buffers, and the central bank of Pakistan has been able to reduce interest rates by 700 bps since June in four consecutive cuts.

Despite this progress, Pakistan’s vulnerabilities and structural challenges remain formidable and the tax base remains too narrow.

The South Asian country is the IMF’s fifth-largest debtor, owing the Fund $6.28 billion as of July 11, according to the lender’s data.