The Persian Gulf Petrochemical Industries Company (PGPIC) has reached a preliminary agreement, worth €3 billion ($3.37 billion), with an unnamed European company on building a petrochemical plant in the southern port city of Asalouyeh in Bushehr Province.
“PGPIC has signed a memorandum of understanding with a European company on construction of a large petrochemical complex to produce two major polymer products for the first time in Iran,” Adel Nejad-Salim, managing director of the PGPIC, was quoted as saying by Shana on Monday.
PGPIC is Iran’s largest petrochemical company with over 60 subsidiaries, owning more than 11% of Iran’s capital market. Its exports are estimated at $8-9 billion per year. According to published reports, PGPIC is the second biggest petrochemical exporter in the Middle East.
The petrochemical project is now in the feasibility study phase, the official said, adding that details will be made available after the two sides finalize the terms of the agreement.
“Two more (unspecified) petrochemical projects are in line for up to €2 billion ($2.2 billion) in investment,” said Nejad-Salim without providing details.
Tehran is making efforts to double annual petrochemical production capacity from the present 65 million tons by opening up the sector to foreign investors. Iran has said it needs $72 billion in foreign investment for 80 major petrochemical projects.
The country aims to diversify its economy that is largely and dangerously dependent on oil export revenue and make better use of its hydrocarbon reserves by producing petrochemicals with higher value-added.
The petrochemical sector is Iran’s second-most valuable industry after oil and gas.
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