Iran Oil Buyers: From Asia-Pacific to Europe

Iran’s deputy minister of petroleum for refining and petroleum products distribution affairs has said that the buyers of Iran’s oil range from Asia-Pacific region, like China and Japan, to Europe.

Abbas Kazemi also referred to Iran’s sustainable export of petroleum products, saying: “For the first time in the history of petroleum industry we have achieved sustainable exports of 400,000 b/d of petroleum products. Despite this big achievement, due to restrictions in ports, we failed to increase our export of these products while there is potential in the country for exporting 500,000 b/d of petroleum products.”

He said that National Iranian Oil Refining and Distribution Company (NIORDC) would reach the 500,000 b/d target with the development of Mahshahr Port.

He added that Iran has gained a 13% share of petroleum products’ exports in the Middle East following the implementation of Iran’s nuclear deal with six world powers, dubbed the Joint Comprehensive Plan of Action (JCPOA).

“Today, with a strong presence in the regional markets of petroleum products, NIORDC which is exporting more than 60 ml/d of products like gasoil and fuel oil holds a 13.5% share in the Middle East exports. This figure reached 209 mb/d in 2015,” Kazemi said.

“Definitely, without having benefited from the JCPOA achievements in foreign relations and international trade, we could by no means imagine acquiring a 13% share of the total regional trade in the Middle East region,” he added.

Iran Open to $72bn Petchem Investment

The head of Iran’s National Petrochemical Company (NPC) says Iran is ready to attract $72 billion in foreign investment for funding 80 petrochemical projects.

Marzieh Shahdaei made the remarks during an address to K 2016 exhibition in Germany’s Dusseldorf.

“Foreign investors can contribute to 30 under-study and 50 under-implementation petrochemical projects in cooperation with Iranian companies,” she said.

“The new projects have a capacity of 49.1 million tons and need $39.8 billion investment. The 50 under implementation projects, which have a capacity of 41.3 million tons, would need $32.3 billion investment,” she added.

Shahdaei said that by 2020 there would be petrochemical projects with a total capacity of 130 million tons, which will reach 180 million tons by 2025.

“With the present capacity, the share of Iranian petrochemical industry’s production in the Middle East stands at 38% and in the world it is 4.8% which will increase as Iran boosts its share of global markets.

The diversity of petrochemical products has seen a 10.6% growth from 2000 to 2014 and the feedstock value-added has been around $9 billion.

Regarding advantages of investment in Iran’s petrochemical industry, Shahdaei said: “Economic diversity, specialized human resources, educated people, growth of domestic markets and geographical position are among the main advantages of investment in this industry.”

Iran's Foreign Investment Promotion and Protection Act (FIPPA) offers equal advantages to Iranian and foreign investors; incentives like 20-year tax exemption and 100% ownership of projects in free zones.

Gasoil/Fuel Oil Exports at 65ml/d

A deputy head of National Iranian Oil Refining and Distribution Company (NIORDC) has said that Iran has joined the exporters of petroleum products and is able to manage its refining capacity based on market demand.

Shahrokh Khosravani said: “We are currently exporting 45 to 50 million liters a day of fuel oil and around 20 million liters a day of gasoil. It means that we are exporting 400,000 of the 1.85 mb/d refining capacity in the country and we have turned into a big exporter of products in the region.”

He said that a policy pursued by the Iranian Ministry of Petroleum was to operate new phases of South Pars gas field in order to inject more gas into national gas trunkline.

“In the 11th administration, gas injection to the country’s gas distribution network and lowering liquid fuel delivery to power plants were done. By taking these two measures we avoided the pollution of the environment due to sulfur, and promoted clean fuel in the country.”

“Given the decline in liquid fuel consumption and the lack of market for fuel oil and gasoil inside the country we moved towards exports. Since last year, we have managed to export gasoil and fuel oil at a sustainable level and given the shortages we have moved to create export infrastructure and made maximum use of export facilities in Bandar Abbas, Mahshahr and Bushehr ports,” he said.

Referring to the steady export of more than 65 ml/d of gasoil and fuel oil, Khosravani said: “In addition to gasoil and fuel, we also export kerosene and liquefied petroleum gas (LPG) and we are just importing gasoline. We hope to become an exporter of gasoline in the near future by operating Persian Gulf Star Refinery and Bandar Abbas refinery development project.”

Malaysian Firms Willing to Invest in Iran

Iran’s Minister of Petroleum Bijan Zangeneh has said Malaysian companies are willing to invest in Iran’s petroleum industry.

“Iran has welcomed investment by Malaysian companies and Petronas that has cooperated with Iran’s petroleum industry for years,” Zangeneh said following a meeting with Malaysian Minister of Foreign Trade and Industry Dato’ Seri Mustafa Muhammad.

The Iranian minister referred to Petronas’ cooperation with Iran before sanctions were imposed on the Islamic Republic, saying the Malaysian company, along with France’s Total, effectively developed phases 2 and 3 of South Pars gas field.

Noting that small-sized Malaysian companies are also willing to invest in Iran, Zangeneh said: “Of course these companies must have financial affordability and prove this capability to us. It means that they must operate projects so that their investment and remuneration will be paid back through a portion of the field’s production.”

Regarding Malaysia’s purchase of crude oil and petroleum products from Iran, he said: “This issue was raised in our meeting and we offered to start from short-term cooperation before expanding it.”

According to Zangeneh, Iranian and Malaysian companies would hold more joint studies and negotiations.

Iran Oil Imports Up

Imports of Iranian oil by four major buyers in Asia in August jumped 81 percent from a year earlier, the biggest percentage gain since April 2014, as the producer recoups market share from rivals Saudi Arabia and Iraq.

Economic sanctions targeting Iran's nuclear program were lifted in January, and it has been battling since then to regain market share lost during the previous four years that the sanctions were in force.

Iran as No. 3 OPEC producer has increased its crude oil exports in August to more than 2 mb/d, according to a source with knowledge of its tanker loading schedule, closing in on Iran's pre-sanctions shipment levels of five years ago.

The top four Asian buyers, South Korea, Japan, China and India, imported 1.84 mb/d in August, government and ship-tracking data showed. That would be the highest in at least five-and-a-half years.

Japan's trade ministry released official data showing its imports rose 31.4 percent from a year earlier to 235,612 b/d.

India's imports nearly tripled from a year earlier to 575,900 b/d, the highest in at least 15 years.

Imports by South Korea more than doubled, while Chinese imports also jumped 48 percent.