EghtesadOnline: Iran will invest $40 billion in the petrochemical sector to increase annual output from the current 66 million tons to 133 million tons over six years, managing director of the National Petrochemical Company told reports on Monday.
“By the end of the current fiscal (March 2020), four petrochemical projects will be inaugurated. Next year (March 2020-2021), 16 plants will start production and seven more will be operational the following year. Until 2025 another 26 projects will come on stream,” the NPC news service Nipna quoted Behzad Mohammadi as saying.
With 50% rise, petrochemical production capacity will reach 100 million tons by 2021. In quantitative development terms, plans are for annual production of 133 million tons by 2025 -- double the current volume.
“Higher production will help reduce imports and create sustainable employment in the key petrochemical sector,” Financial Tribune quoted the official as saying.
Currently, 56 petrochemical plants are active and will reach 83 by 2021.
Most petrochemical plants are in Mahshahr in southwestern Khuzestan Province and Assalouyeh off the Persian Gulf, where water supply is less of a concern and proximity to international sea lanes makes transport cost effective.
Regarding the role of the petrochemical sector in the national economy, the NPC chief said the country’s petrochemical revenue will increase from $17 billion now to $25 billion by 2021 and $37 billion up until 2025.
Currently, 350 types of petrochemicals are produced in Iran for which there is high international demand.
Many countries buy Iranian petrochemicals, including neighboring states, China, India, Southeast Asia and Europe.
Iran’s petrochemical exports are rising as the country tries to offset the impact of hostile US economic sanctions, mainly against the oil, banking and shipping industries.
President Donald Trump last year pulled the United States out of the 2015 nuclear deal, which was signed between Iran and six world powers and re-imposed sweeping sanctions.
On the importance of research and technology in the sector, Mohammadi said: “Petrochemical R&D and technology are focused on two areas: acquiring technical knowledge and having the ability to produce catalysts inside the country.”
There are 40 types of catalyst groups, of which 16 have been indigenized and produced in the country. Production of nine more groups will be undertaken by domestic companies in two years, he added. Indigenizing 15 more groups of catalysts will start after 2021.
Petrochemical is Iran's most important industry after oil and gas. It has played a key role in domestic economic growth as it creates value-added and helps reduce oil and gas exports on which the economy has been dependent for decades.
Petrochemicals accounted for almost 35% of non-oil exports last year. With abundant hydrocarbon reserves and new private sector investments, Iran is working hard to maintain its global status in the key sector and broaden its scope.