Domestic Economy

Huge Potential for Jobs, Revenues in Sangan Deposits

Huge Potential for Jobs,  Revenues in Sangan DepositsHuge Potential for Jobs,  Revenues in Sangan Deposits

The rich mineral reserves in Khorasan Razavi Province offer opportunities for employment and revenues, said deputy minister of industry, mining and trade and managing director of the Iranian Mines and Mining Industries Development and Renovation Organization, Mehdi Karbasian.

"The Sangan region in Khaf County of the province has 1.2 billion tons of proven iron ore reserves and has the capacity to produce 15 million tons of pellets and 17.5 million tons of concentrate annually," said the official, referring to the region as "the second Asalouyeh", IRNA reported.

Asalouyeh is a city in the southern Bushehr Province and home to the world's largest natural gas field, South Pars, shared between Iran and Qatar. According to the International Energy Agency, the field holds an estimated 51 trillion cubic meters of in-situ natural gas and some 7.9 billion cubic meters of natural gas condensates.

"Iran is among the world's top producers of oil and natural gas; but as oil and gas reserves are depleting, many untapped opportunities remain in the mining sector," said Karbasian.

"Mineral explorations are still in early stages," said karbasian, noting that only about 100,000 square kilometers of the country's over 1.6 million-square-kilometer area have so far been explored, that too at shallow depths.  He also observed that some countries have embarked on deep sea mining, further highlighting the vast untapped opportunities in Iran's mining sector.

> Higher Export Revenues

"When operational, the Sangan mining complex is expected to generate $200-$300 million in export revenues," said Karbasian.

According to Karbasian, 1.2 billion tons of iron ore deposits have so far been discovered in Sangan. "The figure is expected to increase by 50-100% after completion of exploration in 12,000 square kilometers of the region, which began last year," he added.

He observed that expansion of iron ore pellet and concentrate production – as the basic raw material for steel manufacturing – will also boost activities in downstream industries.

He also noted that construction of new iron ore pellet and concentrate plants in Sangan will have a positive impact on the under-developed region by creating employment opportunities, adding that road and railway development projects are already underway in the area.

> $2b Investment Needed

Karbasian estimated that $2 billion is required in Sangan, noting that currently five consortiums are providing the funds for the project.

"These consortiums include Mobarakeh Steel Company, Tose'e Melli Investment Company, Khorasan Steel Complex and Gostaresh Steel Industries Company as well as a consortium recently created by two Chinese and four Iranian companies to invest in producing 5 million tons of iron ore pellets and concentrates each," said the official.

The deputy minister predicted mining explorations in the region to be completed in early 2017 and at least one iron ore pelletizing plant to be launched before the end of the current Iranian year (March 19, 2016).