Petroleum Retail Market

in Pakistan

Kalim A. Siddiqui
President Petroleum Marketing
Byco Petroleum Pakistan Limited
(Formerly Bosicor Pakistan Limited)

1
 Presentation Outline

Overview of:

World Economic Outlook

World Oil Scenario

Overview of:

Pakistan Economic Outlook

Pakistan Oil Scenario

Overview of Petroleum Retail Market in Pakistan

Overview of Byco Petroleum Marketing in Pakistan

Conclusion

2
World Economic Outlook

3
 World Economic Highlights

Global GDP is expected to grow at 3.4% in 2010.

The main contribution for growth is coming from developing Asia, with:

- China expected to grow by 9.1% in 2010.

- India forecasted to grow by 7.0% in 2010.

The OECD is forecast to grow on a much lower level of 1.7%. The US is expected to
contribute the most within the OECD at 2.5% in 2010.

Growth in 2010 continues to be challenged by following concerns:

- Level of public debt in almost all OECD regions.

- Record high unemployment levels across the globe.

- Government efforts in China to prevent the economy from overheating.

Source : OPEC Oil Market Report Jan2010

OECD is Organization for Economic Cooperation and Development 4
 World Real GDP Growth Rate

6.00

5.30
5.20
5.00 4.90
4.80
4.70

4.00 3.80
GDP Growth rate

3.40
3.10
3.00
3.00
2.70

2.20
2.00

1.00

-
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010p

Source : CIA World Factbook

5
World Oil Scenario

6
 World Oil Statistics - 2009

Oil Production: 85.43 million bbl/d

Oil Consumption : 85.98 million bbl/d

Oil Exports: 66.13 million bbl/day

Oil Imports: 66.68 million bbl/day

Oil - proved reserves: 1.343 trillion bbl/day

Source : CIA World Fact Book
7
 World Oil Supply & Demand

88

87

86
Million bbl/day

85

84

83

82
1Q2007 1Q2008 1Q2009 1Q2010

Supply Demand

Source : EIA (2010 forecasted)

8
 US $/BBL

0
100
120
140
160

20
40
60
80
Feb-95

OPEC
Jun-95

Source : EIA USA

Oct-95
Feb-96
Jun-96
Oct-96
Feb-97
Jun-97
Oct-97
Feb-98
Jun-98
Oct-98
Feb-99
Jun-99
Oct-99
Feb-00
Jun-00

WTI
Oct-00
Feb-01
Jun-01
Oct-01
Feb-02
Jun-02
Oct-02

North Brent
Feb-03
Jun-03
Oct-03
OPEC Feb-04
Jun-04
Oct-04
Feb-05
Jun-05
Oct-05
Feb-06
Jun-06
Oct-06
Feb-07
Jun-07
Oct-07
Feb-08
Jun-08
Oct-08
Feb-09
Jun-09
Oct-09
9
Crude Oil Price Trend

Feb-10
 Global Refining Capacity

88.0
87.2

85.3 85.4 85.5

86.0
Million barrels per day

84.0
82.8
82.3
82.0
81.5 81.3 81.4
82.0

80.1
80.0

78.0

76.0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Source : ENI World Oil Gas Review 10

 Global Energy Mix For 2009

5.8%
8.0%

35.8%
23.4%

26.9%

Liquids Coal Gas Renewables Nuclear Total

Share 35.8% 27.0% 23.4% 8.1% 5.7% 100.0%

Volume
4,421 3,341 2,889 1,005 703 12,359
(MnToe)

Source : EIA 11
 Global Oil Consumption in 2009

3%
10%

35%

46%
6%

Agriculture Industry Transportation Residential All Other*

Total

Consumption 3% 10% 46% 6% 35% 100%

Source : OPEC Market Review Dec 2009 12

* All Other may include Electricity generation, Non-energy uses, Commercial uses, etc
Pakistan Economic Outlook

13
 Pakistan Real GDP Growth Rate

7.00%

6.00%

5.00%
GDP Growth rate

4.00%

3.00%

2.00%

1.00%

0.00%

2003 2004 2005 2006 2007 2008 2009 2010 p

Source : CIA World Factbook ,

International Monetary Fund 14
 Regional Real GDP Growth Rate Comparison

14%

12%

10%

8%

6%

4%

2%

0%
2003 2004 2005 2006 2007 2008 2009 2010

Pakistan India China Iran UAE Saudi Arabia

Source : CIA World Factbook

World Bank estimates 15
 Pakistan Economic Statistics - 2009

Country GDP US$ 168 billion

Population: 160 million
Per Capita GDP US$ 2,600
GDP Growth rate: 3%
GDP - composition by sector: Agriculture: 20.8%
Industry: 24.3%, Services: 54.9%
Inflation: 10.5%
Exports: US$ 17.87 billion
Imports :US$ 28.31 billion

Source : CIA World Factbook

OPEC 16
 Major Industries, Trading Partners & Export Items

Major Industries
Textile, Sugar, Vegetable Oils,
Agricultural products, Cement,
Fertilizers, Steel, Chemicals,
Sporting goods & carpets

Major Trading Partners

US, Japan, Germany, China, EU
UK, Saudi Arabia & UAE

Major Exports
Oils Seeds, Vegetables, Cotton, Coal, Fertilizer, Telecom equipment, Textile,
Cotton, Rice, Medical instruments, Sporting goods.

17
Pakistan Oil Scenario

18
 Pakistan Energy Statistics For 2009

Oil Production 61,870 bbl/day 59th highest in world

Oil Consumption 383,000 bbl/day 35th highest in world

Oil Exports 30,090 bbl/day 87th highest in world

Oil Imports 319,500 bbl/day 34th highest in world

Oil - proved reserves:339 million bbl 53rd highest in world

Source : CIA World Factbook

19
 Pakistan Energy Statistics For 2009

Natural gas production:37.5 billion cu m 23rd highest in world

Natural gas consumption:37.5 billion cu m 21st highest in world

Natural gas proved reserves: 885.3 billion cu m 26th highest in world

Coal reserves more then 185bn tons 04th highest in world

Source : CIA World Factbook

20
 Pakistan Economy Key Attributes

A market location with great business potential

Strategic location: Gateway to Central Asia (CIS countries).

Neighboring with China, India, Iran and Afghanistan.

Host to major multinationals and global brands in key industrial

areas.

21
 Pakistan Economy Key Attributes

High growth areas are education & training, agribusiness

health & medical, oil & gas, building & construction,
multilateral Projects (ADB-WB), information, communication &
telecom, defense & aviation.

Economy still recovering from oil price inflation and global

downturn.

Infrastructure development still under process in many areas.

22
 Pakistan Economy Key Attributes

Nascent democratic /political setup and security concerns

Proven investment potential during the past few years.

Promising prospects as region is showing good economic

recovery.

Untapped potential of natural resources and alternative

energy avenues.

23
 Petroleum Products Consumption

20.0

18.0

16.0

14.0
Volume in MnMT

12.0

10.0

8.0

6.0

4.0

2.0

0.0
1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-2009 2009-10

Year 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-2009 2009-2010

Consumption
16.9 18.1 18.1 17.4 17.8 15.4 15.5 14.9 17.1 18.5 18.8 20
(MnMT)

Source : OCAC 24
 Infrastructure
Refineries
South NRL, PRL, BPPL CTL

Central PARCO TJB

JGT

North ARL
RWP

CPI
MCH

GAT
QTA MHK

VHR
MFM
SKP
KMK
GWD

WOP

DEPOT

KHI
REFINERY

Source : OCAC 25
 Pakistan Energy Mix - 2009

9.2% 1.3% 0.7%

10.9%

47.5%

30.5%

Gas Liquids Hydel Coal Nuclear LPG Total

Share 47.5% 30.5% 10.9% 9.2% 1.3% 0.7% 100%

Source : POGEE 2009 26

Petroleum Retail Market in Pakistan

27
 Downstream Oil Industry

Annual sales of US$ 11.8 billion.

Direct employment of over 100,000 people.

Indirect employment (transport sector) of another 24,000

persons.

Capital investment of over US$ 0.36 billion over last 5 years.

Annual generation of taxes around US$ 2.37 billion.

Progressive IT infrastructure.

Source : OCAC, HDIP, Pakistan Energy Outlook 28

 Downstream Oil Industry

Skill sets ranging from Technical, IT, Finance, Sales, Marketing

& HR.

Pakistan has the largest no. of CNG vehicles in the world (2.2
million)

CNG Dispensing Facility 2,941 stations. Largest in the world.

Source : OCAC, HDIP, Pakistan Energy Outlook 29

Industry Players

30
 Liquid Fuels Market Participation by OMCs
(July 2009 February 2010)

0.6% 0.1%
1.8% 0.8% 0.0%
0.6%
4.9% 3.2%
0.3%
5.4%

11.0%

71.2%

PSOCL SPL APL CPL TPPL BPPL OOTCL Pearl Hasombe Askar BTCPL Admore Total

% Share 71.2% 11.0% 5.4% 4.9% 3.2% 1.8% 0.8% 0.6% 0.6% 0.3% 0.1% 0.0% 100.0%
Volume in
8,869,234 1,372,405 678,671 607,899 401,400 223,120 101,265 80,027 79,083 34,556 11,244 3,243 12,462,147
MT

Source : OCAC 31
 Retail Outlets Market Participation by Company

1.9% 1.1% 0.6%

3.1% 3.3% 0.6%
4.1%
6.2%

9.2%

55.8%
14.2%

PSO SPL COPL Admore APL TPPL Askar Hascol BPPL OOTCL BTCPL TOTAL

Share 55.8% 14.2% 9.2% 6.2% 4.1% 3.1% 3.3% 1.9% 1.1% 0.6% 0.6% 100.0%

No. Of Outlets 3,620 922 598 401 265 200 213 120 73 38 38 6,488

Source : Corporate websites 32

 Retail Fuel Industry Trends

Non Fuel activities are growing fast.

Stiff competition on retail sites development.
Enhanced branding activities.
Customer more demanding on product quality and
forecourt services.
Growing use of technology and innovation to provide
products and services.

33
Byco Petroleum Pakistan Limited

34
 Bycos Petroleum Marketing Business

Emerging Energy leader

Current refinery capacity 30,000 bbl/day

Upcoming refinery capacity 120,000 bbl/day

Combined refining capacity 150,000 bbl/ day

Will be the largest refining complex in Pakistan after

commissioning of upcoming refinery

Plan to have the first and largest petrochemical facility for the
production of aromatics

35
 Bycos Petroleum Marketing Business

Emerging Energy leader

Aggressive expansion strategy for Petroleum Marketing to become

a major player

Developing storage / product handling infrastructure.

Plan astronomical growth in retail network

Plan to introduce LPG dispensing at our retail outlets

New brand identity to be launched shortly.

36
 Bycos Petroleum Marketing Business

Emerging Energy leader

Plan to develop state of the art NFR facilities at our retail outlets
through the provision of the following facilities:

ATM Services

C-stores

Fast food franchises

Business Centers

Plan to introduce Byco branded lubricants for automotive and

industrial segments.
37
 Number Of Sites

0
6
12
18
24
30
36
42
54
60
66
72

48

4
Aug-07
Sep-07

4
6
Oct-07

7
Nov-07

8
Dec-07
Jan-08

11 12
Feb-08

14
Mar-08

16
Apr-08

20
May-08

28
Jun-08
32
Jul-08
Aug-08
32 32

Sep-08
Oct-08
35 36

Nov-08
Dec-08
Jan-09
Feb-09
Mar-09
Apr-09
37 37 37 37 37 38

May-09
Jun-09
Jul-09
50 50 50

Aug-09
Sep-09
Oct-09
Nov-09
52 52 53 53

Dec-09
56

Jan-10
66

Feb-10
73

Mar-10
38
Progressive Commissioning of Retail Outlets
 0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
Jul-07
Aug-07

0.01%
was 11th
Sep-07

Rank in 2007
Oct-07
Nov-07
Dec-07
Jan-08
Feb-08
Mar-08
Apr-08
May-08
Jun-08
Jul-08
0.88%
Aug-08
Sep-08
Oct-08

Share
Nov-08
Dec-08
Jan-09
Feb-09
Mar-09
Apr-09
May-09
Jun-09
Jul-09
1.42%

Aug-09
Sep-09
Oct-09
Nov-09
6th

Dec-09
Jan-10
Current Rank is

Feb-10
2.64%

39
Progressive Growth in Liquid Fuels Market Share
 Conclusion

Petroleum retail market in Pakistan is growing at a rapid pace.

This segment Offers lucrative business opportunities for investors

and vendors.

Petroleum retail segment is dynamic and is receptive to

technological and service innovation in alignment with the
international market.

NFR activities are expected to increase in this segment in the

coming years.

40
THANK YOU

41