Pakistan's largest oil refinery has moved to overhaul its fuel logistics network, signing a 20-year pipeline agreement aimed at reducing reliance on road transport and improving supply chain efficiency.

Cnergyico Pk Limited confirmed it has ratified a Head of Terms Agreement with Asia Petroleum Limited for the use of a 14-inch pipeline system, according to a notice filed with the Pakistan Stock Exchange.

The arrangement is designed to transport high-speed diesel from the refinery to the Zulfiqarabad Oil Terminal, with onward links to the White Oil Pipeline system and storage facilities at Port Qasim. The framework outlines commercial and regulatory terms, with final agreements subject to approvals and completion of connectivity requirements.

The move signals a strategic shift towards pipeline-based distribution, a system expected to ease pressure on road networks. By limiting tanker traffic, the initiative could help reduce congestion and lower accident risks associated with fuel transport.

Beyond safety considerations, the agreement is intended to strengthen logistical reliability. Direct connectivity between refinery and terminal infrastructure is likely to enhance delivery consistency and provide access to established pipeline networks.

Cnergyico, a vertically integrated operator across refining and marketing segments, already controls significant infrastructure, including crude oil terminals, storage capacity and a nationwide retail network. The company's latest initiative reflects an effort to optimise operations and modernise distribution channels.

In an environment where efficiency and risk management are increasingly central to energy logistics, such long-term infrastructure partnerships may play a critical role in shaping the sector's evolution.