Iran’s petchem output set to grow by 10m tonnes: CEO
Iran’s petrochemical industry is now endowed with a 90-million-tonne production capacity, which is set to reach a record 100 million tonnes by the end of current Persian calendar year in late March, according to the CEO of National Petrochemical Company (NPC).
Behzad Mohammadi said the petrochemical industry earned Iran $15 billion in revenue from domestic and foreign sales of petrochemicals, last calendar year, shana.ir reported.
Speaking to Iran Petroleum, Mohammadi added that foreign investors were yet to hint at cooperation with Iran as hopes are growing for the revival of the 2015 Iran nuclear deal with world powers, also known as JCPOA, and concomitant removal of US sanctions.
“However, if investors want to cooperate with the Iranians, we need their cooperation in the technical knowhow sector,” added the official.
“Many foreign companies left Iran, as sanctions were restored. Now, the return of these companies depends on the political circumstances in the country. As long as necessary conditions are not fulfilled, we have to go ahead as we are doing now. But generally speaking, if we take a look at the petrochemical industry in terms of development, production and exports, we will find out that we have been largely resilient. Therefore, it could be argued that our conditions were not severely affected by sanctions. Of course, we could have fared much better in terms of development; however, the petrochemical industry has an acceptable record now.
“As JCPOA talks go ahead, we have not received any serious signal from foreign investors, but there are signs of overture and better atmosphere for external communications. As far as cooperation with foreign investors is concerned, the petrochemical industry needs the partnership of major foreign companies for providing investment and technical knowhow. In some points, we need to use foreign technology.”
Key chapter in Iran-china pact
“Following the Iran-china 25-year cooperation pact, we have not yet had any talks with the Chinese, but petrochemicals constitute a very significant chapter in the pact,” insisted NPC chief.
“We have listed incomplete projects and those that need finance. Our projects are incorporated in this package, but we have not held talks to discuss details. The petrochemical industry supplies nearly 35% of national hard currency generation. Last [calendar] year we met our commitments for hard currency generation for the Central Bank at 150%. The petrochemical industry has been highly instrumental in stabilizing the economic conditions in the country.”
Petchem exports at 25m tonnes
“Last Persian calendar year (ending March 20), despite restrictions caused by sanctions, as well as decline in demand due to the coronavirus pandemic, we exported 25 million tonnes of products, which yielded $10 billion. We also sold 10 million tonnes on domestic markets for $5 billion. There is no other industry in the country to supply 10 million tonnes of products to its downstream sector. Such amount of products would result in prosperity and unrivalled job creation at 15,000 small and large-sized enterprises in the downstream sector of the petrochemical industry,” said Mohammadi.
Output capacity up
Speaking of the prospect of growth for petrochemical output in the country, Mohammadi said, “The annual growth in demand for petroleum products is less than 0.9% at the global level. The rate stands at about 5% when it comes to petrochemical products, an important sign of necessity for the further development of the petrochemical industry. Therefore, we need to use rich oil and gas deposits as feedstock and follow a roadmap towards quick and smart development of the petrochemical industry and generation of wealth.”
“The petrochemical production capacity was 65 million tonnes in the Iranian calendar year to March 2020. Implementation of 17 new projects has brought the figure to 90 million tonnes, a historic record in this industry. Among the second jump projects, 10 remain to become operational. They have had 84% progress, which would come online by March 2022. Then, the petrochemical production capacity would reach 100 million tonnes, which would mean that the petrochemical development target has been met.”