EghtesadOnline: A consortium of Philippine and Chinese companies will help Iran complete its value chain in the petrochemical industry, National Petrochemical Company's deputy for investment said.
"Talks have been finalized and the consortium will invest as much as $7 billion to build a petrochemical complex to convert methanol to more value-added commodities," Hossein Alimorad was also quoted as saying by IRNA.
According to the official, the unnamed multinational firm has expressed readiness to undertake the venture soon after permits have been obtained.
At present, the machinery and equipment are being transferred to the construction site, according to Financial Tribune.
"The initiative, which will be completed in two phases, calls for constructing a methanol plant and units to convert it to value-added products," he said, adding that close to $2.8 billion will be in invested in the first phase.
Alimorad noted that the plan also includes the construction of a production unit that will covert natural gas to mono-ethylene glycol.
The much-needed licenses and know-how are expected to be imported from China.
Referring to the advantages of the deal, he said minimizing investment risks, increasing the speed of undertaking petrochemical projects, facilitating the transfer of know-how, completing value-added chains in petrochemical industries and connecting upstream, midstream and downstream sectors are among the most notable benefits of such a contract.
According to the official, empowering the petrochemical industry will not only create more jobs, but can also help Iran diversify its economy and reduce dependence on oil export revenues as it is a driver of economic growth.
Reportedly, the Petrochemical Research and Technology Company of Iran has finalized an agreement with France's Air Liquide Engineering and Construction Company on transferring state-of-the-art technology and granting much-needed licenses to convert methanol to propylene under PARS MTP brand.
"PRTC has launched a pilot polypropylene production project with a limited output of 120,000 tons per annum," he said, noting that plans are in place to raise the production of the complex to 500,000 tons per year in cooperation with energy majors, namely Air Liquide.
--- Protracted Talks
According to Alimorad, PRTC has also held lengthy talks with companies from Norway and Japan on purchasing petrochemical know-how, though no agreement has been reached yet.
NPC has already concluded an MoU with Sojitz Corporation, a major Japanese industrial and engineering conglomerate, to establish a methanol-to-propylene plant in Iran.
The deal is part of efforts to raise installed petrochemical production capacity to 130 million tons annually by 2020.
PRTC signed an MoU with Norway's Norner institute this year on providing Iranian petrochemical industry with the expertise to develop polypropylene production.
Polypropylene is a thermoplastic polymer used in a wide variety of applications, including packaging and labeling, textiles, carpets, stationery, plastic parts and reusable containers of various types, laboratory equipment, loudspeakers, automotive components and polymer banknotes.
Polypropylene is the world's second-most widely produced synthetic plastic, after polyethylene.
Iran's nominal output capacity stands at 62 million tons of petrochemicals per annum. NPC hopes to lift nominal output capacity to more than 120 million tons per annum by 2022, the last year of Iran's Sixth Five-Year Economic Development Plan.
Tehran earned $9.55 billion in revenues from petrochemical exports last year, official data show. Petrochemical consignments went mostly to Asia, Europe and South America.
Petrochemical is Iran's biggest industry after oil and gas.