Sixteen petrochemical projects worth approximately $17 billion are being developed by the Persian Gulf Petrochemical Industries Company.
The initiatives will help complete the value chain of petrochemicals and boost the National Petrochemical Company’s annual output by 21 million tons.
Jafar Rabiei, the PGPIC chief, made the statement in the opening ceremony to inaugurate the light naphtha desulfurization unit in Bu Ali Sina Petrochemical Company in Khuzestan Province in Mahshahr on Saturday, the Oil Ministry’s news service Shana reported.
“Completed at an estimated cost of $100 million by local contractors, the plant will produce 230,000 tons of liquefied petroleum gas in addition to 120,000 tons of C5 raffinate that is primarily used as a raw material for synthetic rubber and petroleum resins,” he added.
Light naphtha (a petrochemical feedstock) comes from the distillation of crude oil and its conversion to value-added commodities is a priority in the petrochem sector.
A subsidiary of NPC, Bu Ali Sina Company opened in 1998 in Mahshahr, Khuzestan Province. It annually produces 350,000 tons of light naphtha, most of which will be converted to LPG and C5 raffinate, and exported.
Rabiei said the export of value added petrochemicals like LPG can earn the company at least $50 million per year.
The company also produces 500,000 tons of heavy naphtha that is sold in local and international markets to be used in the production of gasoline, kerosene and industrial solvents.
It processes gas condensate as feedstock to produce an estimated 1.75 million tons of aromatic products a year, including benzene, paraxylene, heavy naphtha, light naphtha and liquid petroleum gas.
According to the official, the petrochem company’s products are supplied to Bandar Imam Khomeini, Shahid Tondgouyan, Amir Kabir, Pars and Karun petrochemical companies and exports the surplus to the Middle East and Southeast Asia.
The company produced 610,000 tons of benzene in 2020, up 8% compared to the previous year.
The increase has made Iran self-reliant in benzene and ended the need to import this chemical used in the production of detergents and hygiene products.
“In addition to ending benzene import, we have started exports,” he said.
PGPIC is implementing projects in Sadaf Petrochemical Company in Asalouyeh in Bushehr Province, Dehdasht Petrochemical Complex in Kohgilouyeh-Boyerahmad, Urmia Petrochemical Complex’s methyl amine project in Sonqor, Kermanshah Province, and the sodium hydroxide expansion plan in Mahshahr, Khuzestan Province.
Mahshahr Petrochem Plant
Rabiei also broke ground on Mahshahr Petrochemical Plant in Mahshahr Special Petrochemical Economic Zone in Khuzestan Province on Saturday.
“Upon completion, Mahshahr polyolefin plant will add 1.7 million tons to NPC’s current annual output at 70 million tons,” he added.
The mega project includes an olefin unit that will produce 1.2 million tons of ethylene and 500,000 tons of propylene. It will also have a polymer unit to produce polyethylene, polypropylene and ethylene glycol.
The official noted that PGPIC’s subsidiaries produce close to 21 million tons of 65 types of petrochemical products annually.
“The holding’s export revenues stood around $3 billion in 2020. The company sold products worth $75 million in the domestic market,” he added.
PGPIC is the biggest consortium of Iranian petrochemical producers. With a market capitalization of $11.7 billion, the giant holding is the largest company listed on Tehran Stock Exchange and the second largest petrochemical company in the Middle East with 60 plus subsidiaries.
In a bid to lift the plunging capital market, the government recently eased rules for listing investment companies in the bourse.
Tehran is making efforts to double annual petrochemical production capacity from around 70 million tons by opening up the sector to foreign investors. Over $70 billion in foreign investments are needed to implement 80 petrochemical projects.
The country aims to diversify its economy that is largely dependent on oil revenues 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.
