EghtesadOnline: Japan is set to import a naphtha cargo from Iran this month, a source said, marking the first import from the Middle Eastern country since 2011.
Japan's Mitsubishi is to receive a naphtha cargo from Iran, a source with direct knowledge of the matter told S&P Global Platts. Asked to confirm whether Mitsubishi is taking a cargo from Iran, the source said "not untrue," declining to elaborate further, Platts reported on Sunday.
This will be Japan's first import of Iranian naphtha since the country last imported 47,212 tons in 2011, according to the ministry of economy, trade and industry data.
Japanese trading houses and refiners did not import any Iranian naphtha since the EU imposed in mid-2012 its ban on P&I reinsurance cover for Iranian oil shipping, market sources said.
According to Financial Tribune, the EU restrictions made it difficult for Japanese importers to take in Iranian oil products, although local refiners have maintained their crude and condensate imports from Iran, using the Japanese government insurance, which only covers very large crude carriers, sources said.
Despite the lifting of US and EU nuclear sanctions against Iran in January last year, Japanese importers did not take any oil products from the producer because of the unavailability of protection and indemnity coverage from US insurers and ambiguity over reinsurance coverage, Platts said.
News of Japan's Iranian naphtha imports emerged as the country's major Persian Gulf Star Refinery shipped its second naphtha cargo.
The first went to the UAE, with the second shipped to Japan in late January and due to arrive by the end of this week.
"A couple of months ago, the crude distillation units of the refinery produced diesel, LPG and naphtha. The CCR [continuous catalytic reforming] units are in the pre-commissioning phase. I hope this will take two or three months," Iran's deputy oil minister, Abbas Kazemi, said in an interview with Platts in Tokyo on January 26.
"Phase two will come maybe six months later, so by 2018 we should have full capacity," said Kazemi, who is also president of the National Iranian Oil Refining and Distribution Co.
Two others phases of the Star refinery will triple its gasoline output to 36 million liters per day. Combined with 3 million liters per day of gasoline from the new units at the Bandar Abbas refinery, Iran's total domestic gasoline production could rise by 39 million liters per day to 103 million liters per day, making it a significant net exporter of gasoline, Kazemi added then.