Byco Petroleum Pakistan Limited a leading oil refining company in Pakistan has raised its share in the country’s gasoline supply by sevenfold. It is said that the share of Byco Petroleum has risen from 1 to 7 percent in Pakistan supply pool of motor gasoline. The management of the company mentioned in their financial statement that during the quarter ended 30th September, 2018 which was yet another challenging period for the oil sector as Pak Rupee posted another depreciation of 6 percent and crude oil prices raised by 4 percent. The experts of Byco also mentioned that this has resulted in considerably squeezing of refinery GRMs and consequently the profitability. Pakistan’s consumption of High Speed Diesel (HSD) also stayed considerably low in the month of August 2018, which resulted in lower throughput of the refineries.
| Byco: Total Assets (Rs. Mn) | |||
|---|---|---|---|
| Year | Current Assets | Non Current Assets | Total Assets |
| 2018 | 41,861 | 87,886 | 129,748 |
| 2017 | 21,629 | 88,209 | 109,839 |
| 2016 | 20,641 | 35,251 | 55,893 |
| 2015 | 18,549 | 36,386 | 54,935 |
| 2014 | 38,589 | 20,665 | 59,254 |
| 2013 | 20,537 | 23,371 | 43,908 |
| Source: Byco | |||
Furthermore, the government of Pakistan facts revealed that the yearly consumption of petroleum products in the country was approximately 26 million tons during FY2016-17. During July-Feb FY 2017-18, 60.4 million barrels of crude oil was imported, while 21.8 million barrels was domestically extracted. The indigenous crude oil meets only 15 percent of Pakistan’s total requirements, while 85 percent requirements are met by imports in the shape of crude oil and refined petroleum products. The indigenous and imported crude is refined by 6 main and 2 small refineries.
Statistics also showed that imported’ crude and refined petroleum products make 82-83 percent of our total consumption. Domestic crude oil production (89kbo/d) is 33 percent of the total crude we use (93 MMbo).
| Byco: EPS & Gross Profit | ||
|---|---|---|
| Year | EPS (Rs) | Gross Profit (Rs. Mn) |
| 2018 | 0.94 | 9,150 |
| 2017 | 0.41 | 4,224 |
| 2016 | 1.4 | 4,283 |
| 2015 | 0.07 | 4,866 |
| 2014 | -6.07 | 409 |
| 2013 | -2.31 | 76 |
| Source: Byco | ||
The Byco management also informed in the quarterly statement 2018 that the operations of Isomerisation unit, commencing during the period by the wholly owned subsidiary of the Company. The operations of Isomerization unit have begun its optimistic contribution to the business and its profitability as there was no Naphtha export in current period.
The financial experts of the company also mentioned that Byco Petroleum Pakistan posted gross sales of Rs 66 billion as against to Rs 41 billion in the corresponding period previous year recording 61 percent rise from the corresponding period previous year, however, much of this relates to the rise in international oil prices and growing US dollar.
Mentioned in the financial statement of Byco, the company generated gross profit of Rs 1.7 billion (2017: Rs 2.3 billion) and net profit of Rs 397 million (2017: Rs 1.2 billion). The fall in profits is mainly because of lower GRMs and rising cost of materials. Earnings per share (EPS) for the period was posted to Rs. 0.07 as against to Rs. 0.23 previous year. It is presently said that the Government of Pakistan has paid $4.3 billion for the crude oil imports and over $2 billion for gas (LNG) during FY2018.
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No doubt, Pakistan is bestowed with huge shale gas and conventional oil & gas resources, locked up in areas of difficult access. Oil and gas is main contributor of energy and require aggressive attempts for their search and development. For last 60 years, efforts are continuously made to explore conventional oil and gas reservoirs while unconventional reservoirs are yet to be exploited. Statistics also revealed that over the last 10-15 years, replacing reserves and sustaining oil and gas production has remained a serious issue for the local oil and gas industry.
Industry experts also recorded that the refineries sector in the country experienced a tough quarter because of growing crude prices and Pak rupee depreciation. This squeezed the profitability of the sector, however, Byco managed both the risks better than the industry peers. Different sources mentioned that with local refineries facing a prospect of being shut down because of growing inventory of furnace oil, the management of Byco is in communication with prospective buyers abroad for the export of surplus fuel oil to various states. Sources also calculated that the company is producing only 20,000 barrels per day (bpd) despite possessing a capacity of 155,000 bpd, contributing to under-utilization of the refinery.