Federal government imposes ban on import of furnace oil
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ISLAMABAD - Federal government has notified an immediate ban on import of furnace oil and ordered local refineries to decrease the production of furnace oil (FO) to a bare minimum, reports *Dawn.*
According to a notification issued by the Ministry of Energy (MoE), the government has directed refineries to sign commercial agreements with power producers for using their capacity for furnace oil storage.
MoE directed in future all refineries ensure furnace oil production is a minimal byproduct of crude oil processing.
It stated the oil refineries handle production of additional storage facilities and use the collected proceeds from ‘deemed duty’ for the modernization and improvement of their facilities.
The domestic refineries product around 30% furnace oil of their overall capacity utilization. In the past few years, to facilitate liquefied natural gas (LNG) imports for cheaper electricity production, the government has been planning to phase out furnace oil.
Additionally, the notification said an immediate ban on import of furnace oil has been enforced starting 2nd January except for K-Electric.
