ID :
207031
Wed, 09/14/2011 - 10:31
Auther :
Shortlink :
https://oananews.org//node/207031
The shortlink copeid
Turquoise Targets Energy-Efficient Companies on Iran Subsidy Cut
TEHRAN (FNA)- Turquoise Partners, a Tehran-based investment firm that manages $180 million in assets is looking to buy shares in power-saving companies after Iran cut energy subsidies.
Iran began phasing out the three-decade-old subsidies last year to curb unnecessary energy use and boost profitability in the Persian nation.
Turquoise, which invests for foreign and domestic clients on the Tehran Stock Exchange, looks for companies using energy efficiently, Managing Director Ramin Rabii said. Turquoise overhauled its portfolio to correspond with the subsidy cuts, he told Bloomberg in a phone interview from the Iranian capital.
When selecting a stock now, "it's very important for us to take into account the energy-efficiency of the company," Rabii, who helped found Turquoise in 2005, said.
"We have a portfolio of different companies and it's very important for us to make sure our investments are safe from the subsidy removal plan," he said. The winners will be those that become more energy-efficient, he said, without naming companies. Turquoise has generated an average annual return of about 20 percent the past five years, Rabii said.
"A lot of the older factories that are very inefficient in terms of energy consumption might actually go bust during this period," he said. Iran, with about 74 million residents, gets almost all of its power from natural gas and oil, according to Rabii.
The cuts have driven up productivity in energy-intensive industries such as cement that have higher power costs, he said.
Energy efficiency may become a "significant" investor opportunity in Iran, the second-largest oil producer in the Organization of the Petroleum Exporting Countries after Saudi Arabia, and as the nation's young population reaches working age and boosts consumption, Rabii said.
"Energy is a significant portion of the monthly cost so efficiency has suddenly become extremely important both for households and companies," he said. Each Iranian now receives about $44 a month in cash to offset the higher costs, he said.
Turquoise to date has $100 million invested in stocks on the Tehran exchange and $80 million in private equity transactions, Rabii said.
"Iran is one of the countries with the biggest energy potential in the world for investors," he said. The nation is also undergoing a privatization plan that affects all industries including energy and power plants, he said.
"Definitely the trend going forward is going to be liberalization and privatization of the energy sector as a whole except for upstream oil and gas," he said. Iran inaugurated its first atomic power plant this week, officially linking it to the country's electricity grid.
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. A large number of Chinese, Indian and other Asian firms have negotiated or signed up to oil and gas deals with Iran.
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 in investment or expansion of 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 the 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 with a European firm, worth €100m ($147m, £80m), was signed by Steiner Prematechnik Gastec, the German engineering company, this year 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.
Iran began phasing out the three-decade-old subsidies last year to curb unnecessary energy use and boost profitability in the Persian nation.
Turquoise, which invests for foreign and domestic clients on the Tehran Stock Exchange, looks for companies using energy efficiently, Managing Director Ramin Rabii said. Turquoise overhauled its portfolio to correspond with the subsidy cuts, he told Bloomberg in a phone interview from the Iranian capital.
When selecting a stock now, "it's very important for us to take into account the energy-efficiency of the company," Rabii, who helped found Turquoise in 2005, said.
"We have a portfolio of different companies and it's very important for us to make sure our investments are safe from the subsidy removal plan," he said. The winners will be those that become more energy-efficient, he said, without naming companies. Turquoise has generated an average annual return of about 20 percent the past five years, Rabii said.
"A lot of the older factories that are very inefficient in terms of energy consumption might actually go bust during this period," he said. Iran, with about 74 million residents, gets almost all of its power from natural gas and oil, according to Rabii.
The cuts have driven up productivity in energy-intensive industries such as cement that have higher power costs, he said.
Energy efficiency may become a "significant" investor opportunity in Iran, the second-largest oil producer in the Organization of the Petroleum Exporting Countries after Saudi Arabia, and as the nation's young population reaches working age and boosts consumption, Rabii said.
"Energy is a significant portion of the monthly cost so efficiency has suddenly become extremely important both for households and companies," he said. Each Iranian now receives about $44 a month in cash to offset the higher costs, he said.
Turquoise to date has $100 million invested in stocks on the Tehran exchange and $80 million in private equity transactions, Rabii said.
"Iran is one of the countries with the biggest energy potential in the world for investors," he said. The nation is also undergoing a privatization plan that affects all industries including energy and power plants, he said.
"Definitely the trend going forward is going to be liberalization and privatization of the energy sector as a whole except for upstream oil and gas," he said. Iran inaugurated its first atomic power plant this week, officially linking it to the country's electricity grid.
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. A large number of Chinese, Indian and other Asian firms have negotiated or signed up to oil and gas deals with Iran.
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 in investment or expansion of 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 the 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 with a European firm, worth €100m ($147m, £80m), was signed by Steiner Prematechnik Gastec, the German engineering company, this year 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.
