ID :
205731
Wed, 09/07/2011 - 10:46
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Shortlink :
https://oananews.org//node/205731
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Iran Plans to Build Petrochemical Complex in Persian Gulf Port
TEHRAN (FNA)- The Iranian government is in talks with investors across Asia to build petrochemical joint ventures in the Southeastern port city of Chabahar on the rims of the Persian Gulf, sources said.
"The Iranian government wants to develop Chabahar on the lines of Pars special economic zone in Assalouyeh," a source privy to the plan told Platts. "The plan is to establish methanol, urea and olefins projects in Chabahar in association with foreign partners." The government has already marked a free trade zone in Chabahar for establishing the petrochemical plants, the source said, adding that no major plants are currently located in that city.
At the 9th Iran Petrochemical Forum in Tehran in May, the country's Deputy Oil Minister Abdolhossein Bayat had said that petrochemical projects to be located in Chabahar will be given a tax holiday of 15 years.
The establishment of the projects in Chabahar is in line with Iran's plan for the port city to achieve a petrochemical production capacity of 15 million mt/year over the next five years, the source said. This will require investments totaling $20 billion, he added.
A senior official at Iran's National Petrochemical Company told Platts in July that the country needs "billions of dollars worth of investments" to attain its target of raising its petrochemicals production capacity from 51 million mt/year as outlined in its five-year development plan (2010-2015).
Iranian officials told FNA in May that the country has planned five methanol projects -- in addition to an ammonia project and urea project -- at Chabahar to be constructed over the next five years. Two olefins projects -- Olefins 18 and Olefins 19 -- have also been planned for the Southeastern Iranian city. The capacities of these projects have yet to be announced.
The Tehran Times reported in mid-August that the government is making the required arrangements to supply about 20 million cubic meters/day of natural gas and 3.6 million mt/year of ethane to Chabahar. The gas is to be supplied from the South Pars gas field in the Southern port city of Assalouyeh. Construction of a gas pipeline linking Assalouyeh and Chabahar is expected to be completed in the next 36 months.
Meanwhile, the plan for Chabahar comes close on the heels of news that India, one of the largest importers of petrochemicals from Iran, is directing resources to develop the Chabahar port.
At the 16th Indo-Iran Joint Commission meeting held in New Delhi in July, the two nations had decided to expedite the development of Chabahar port.
"Chabahar is one of the closest cities to India and the two nations see it as a strategic port," the source said. "India's involvement in Chabahar port makes it highly possible that the petrochemical companies that may invest in the Chabahar special economic zone will be Indian."
Foreign investments into Iran have been restricted because of international sanctions against Tehran over its nuclear program. Sanctions imposed by the US and European Union specifically target the oil, gas and petrochemical sectors in the country.
Iran, which sits on the world's second largest reserves of both oil and gas, is facing US sanctions over its civilian nuclear program.
Iranian officials have dismissed US sanctions as inefficient, saying that they are finding Asian partners instead. Several Chinese and other Asian firms are negotiating or signing up to oil and gas deals.
In a recent case, Iran signed gas deals worth $14 billion with Malaysia's SKS Group in December 2008, which included a contract to build an LNG plant.
Following US pressures on companies to stop business with Tehran, many western companies decided to do a balancing act. They tried to maintain their presence in Iran, which is rich in oil and gas, but not getting into big deals that could endanger their interests in the US.
Yet, after oil giants in the West witnessed that their absence in big deals has provided Chinese, Indian and Russian companies with excellent opportunities to sign up to an increasing number of energy projects and earn billions of dollars, they started showing increasing interest to invest or expand work in Iran.
Some European states have also recently voiced interest in investment in Iran's energy sector after the gas deal was signed between Iran and Switzerland regardless of US sanctions.
The National Iranian Gas Export Company and Switzerland's Elektrizitaetsgesellschaft Laufenburg signed a 25-year deal in March 2008 for the delivery of 5.5 billion cubic meters of gas per year.
The biggest recent deal, worth €100m ($147m, £80m), was signed by Steiner Prematechnik Gastec, the German engineering company, in 2009 to build equipment for three gas conversion plants in Iran.
In December 2010, the New York Times reported that over the past decade, United States-based companies have done billions of dollars in trade with Iran despite sanctions and trade embargoes imposed on Tehran.
One American company, the daily said, was permitted to do work on an Iranian gas pipeline, despite sanctions aimed at Iran's gas industry in particular.
The transactions have been made possible by a 2000 law that allows exemptions from sanctions for companies selling food or medical products, the report added.
Iranian officials have always stressed that the International and unilateral sanctions against Iran have had no result but inflicting damage on the European companies.
"The Iranian government wants to develop Chabahar on the lines of Pars special economic zone in Assalouyeh," a source privy to the plan told Platts. "The plan is to establish methanol, urea and olefins projects in Chabahar in association with foreign partners." The government has already marked a free trade zone in Chabahar for establishing the petrochemical plants, the source said, adding that no major plants are currently located in that city.
At the 9th Iran Petrochemical Forum in Tehran in May, the country's Deputy Oil Minister Abdolhossein Bayat had said that petrochemical projects to be located in Chabahar will be given a tax holiday of 15 years.
The establishment of the projects in Chabahar is in line with Iran's plan for the port city to achieve a petrochemical production capacity of 15 million mt/year over the next five years, the source said. This will require investments totaling $20 billion, he added.
A senior official at Iran's National Petrochemical Company told Platts in July that the country needs "billions of dollars worth of investments" to attain its target of raising its petrochemicals production capacity from 51 million mt/year as outlined in its five-year development plan (2010-2015).
Iranian officials told FNA in May that the country has planned five methanol projects -- in addition to an ammonia project and urea project -- at Chabahar to be constructed over the next five years. Two olefins projects -- Olefins 18 and Olefins 19 -- have also been planned for the Southeastern Iranian city. The capacities of these projects have yet to be announced.
The Tehran Times reported in mid-August that the government is making the required arrangements to supply about 20 million cubic meters/day of natural gas and 3.6 million mt/year of ethane to Chabahar. The gas is to be supplied from the South Pars gas field in the Southern port city of Assalouyeh. Construction of a gas pipeline linking Assalouyeh and Chabahar is expected to be completed in the next 36 months.
Meanwhile, the plan for Chabahar comes close on the heels of news that India, one of the largest importers of petrochemicals from Iran, is directing resources to develop the Chabahar port.
At the 16th Indo-Iran Joint Commission meeting held in New Delhi in July, the two nations had decided to expedite the development of Chabahar port.
"Chabahar is one of the closest cities to India and the two nations see it as a strategic port," the source said. "India's involvement in Chabahar port makes it highly possible that the petrochemical companies that may invest in the Chabahar special economic zone will be Indian."
Foreign investments into Iran have been restricted because of international sanctions against Tehran over its nuclear program. Sanctions imposed by the US and European Union specifically target the oil, gas and petrochemical sectors in the country.
Iran, which sits on the world's second largest reserves of both oil and gas, is facing US sanctions over its civilian nuclear program.
Iranian officials have dismissed US sanctions as inefficient, saying that they are finding Asian partners instead. Several Chinese and other Asian firms are negotiating or signing up to oil and gas deals.
In a recent case, Iran signed gas deals worth $14 billion with Malaysia's SKS Group in December 2008, which included a contract to build an LNG plant.
Following US pressures on companies to stop business with Tehran, many western companies decided to do a balancing act. They tried to maintain their presence in Iran, which is rich in oil and gas, but not getting into big deals that could endanger their interests in the US.
Yet, after oil giants in the West witnessed that their absence in big deals has provided Chinese, Indian and Russian companies with excellent opportunities to sign up to an increasing number of energy projects and earn billions of dollars, they started showing increasing interest to invest or expand work in Iran.
Some European states have also recently voiced interest in investment in Iran's energy sector after the gas deal was signed between Iran and Switzerland regardless of US sanctions.
The National Iranian Gas Export Company and Switzerland's Elektrizitaetsgesellschaft Laufenburg signed a 25-year deal in March 2008 for the delivery of 5.5 billion cubic meters of gas per year.
The biggest recent deal, worth €100m ($147m, £80m), was signed by Steiner Prematechnik Gastec, the German engineering company, in 2009 to build equipment for three gas conversion plants in Iran.
In December 2010, the New York Times reported that over the past decade, United States-based companies have done billions of dollars in trade with Iran despite sanctions and trade embargoes imposed on Tehran.
One American company, the daily said, was permitted to do work on an Iranian gas pipeline, despite sanctions aimed at Iran's gas industry in particular.
The transactions have been made possible by a 2000 law that allows exemptions from sanctions for companies selling food or medical products, the report added.
Iranian officials have always stressed that the International and unilateral sanctions against Iran have had no result but inflicting damage on the European companies.
