Pakistan and Saudi Arabia are set to sign a Memorandum of Understanding (MoU) for the construction of a multi-billion dollar Saudi Aramco oil refinery in Gwadar, according to Saudi English daily Arab News.

Earlier this week, a cabinet member confirmed that Saudi Crown Prince Mohammad bin Salman would arrive in the country in the first week of February and an MoU for establishing a petro-chemical complex was still being worked out on the request of Riyadh.

Pakistan has already received $2bn in cash deposit from Saudi Arabia at an interest rate of 3.18pc while the third tranche of $1bn is due in the first week of February. The Saudi oil facility would also start rolling out this month with an average $274 million per month.

According to Arab News, it is expected that Pakistan will sign a number of investment deals including the construction of mega oil refinery in the month of February in the presence of a high-level Saudi delegation. The conformation to this effect was given by Information Minister Fawad Chaudhry.

“The oil refinery project is the biggest investment project of Saudi Arabia in Pakistan,” Chaudhry was quoted as saying by Arab News

“A 15-member delegation of Saudi Arabia visited Gwadar from Karachi as part of the finalisation process of the MoU for Aramco oil refinery,” Haroon Sharif, Minister of State and Chairman of Pakistan Board of Investment (BoI), told Arab News.

“We have finalised the MoU for the construction of Aramco oil refinery [...] overall directions have been agreed upon and the agreement will be signed at an appropriate time,” Sharif said.

The BoI chief had said earlier: “We are going to sign MoUs with Saudi Aramco and Acwa Power within few weeks. Saudi Aramco is going to set up oil refinery and petrochemical complex in Pakistan while Acwa Power will invest in Pakistan renewable energy sector."

“I am expecting around $15 billion investment from Saudi Arabia in the next 3 years. The inflow of investment for oil refinery and petrochemical complex in Pakistan is estimated to be between $6 billion to $10 billion,” BoI Chairman told Arab News.

Last month, Finance Minister Asad Umar had said that an incoming investment package from Saudi Arabia, which promises to be "the biggest foreign investment in Pakistan history", will be announced soon.

Correction: The story earlier erroneously mentioned $15 billion in the headline. A correction has been made and the error is regretted.