Petrochemical revenues from the export of 22 million tons of products have reached $15 billion during the first 11 months of the current Iranian year (March 21, 2022-Feb. 19), the National Petrochemical Company’s director for planning and development said.
“Out of this amount, 90% were injected into the secondary foreign exchange market, locally known as Nima,” Hassan Abbaszadeh was also quoted as saying by the Oil Ministry’s news agency Shana.
Nima is an online platform affiliated to the Central Bank of Iran where exporters sell their overseas currency income and companies buy for importing machinery, equipment and raw materials.
According to the official, the sector’s total earnings in the last fiscal year stood at $15 billion and 65 petrochemical companies contributed $13 billion of their revenue to Nima.
“Revenues of Iran’s petrochemical industry are projected to increase by $4 billion compared to last Iranian year [March 2021-22] and reach $19 billion by the end of the current fiscal year [March 2023],” he said.
Last year, petrochemical feedstock increased and 5 million tons were added to the production capacity of the petrochemical industry.
Abbaszadeh noted that the annual output is now around 35 million tons and will approach 40 million tons by the end of 2023, which will increase revenues.
“Our focus is to complete the value chain of petrochemical products so that we can reduce the sale of raw materials and semi-finished products, create more added value and eliminate the need for imports, which currently stand at $1.5-2 billion,” he added.
Referring to investments in the petrochemical industry, Abbaszadeh said, “Due to the lower attraction of foreign investments in the past few years, the main burden has been borne by holding companies and they invest about $4 billion annually in the petrochemical sector.”
Private Sector
Since almost all the major holding companies are semi-private ones, the official hoped that the real private sector would also invest in the petrochemical industry.
“Currently, 140 types of products are produced in petrochemical complexes across the country and an addition of 20 products is planned in the next five years,” he added.
According to the official, currently 68 projects are underway with an average progress of 30%.
“These projects require an investment of $35 billion and so far $9 billion have been spent on them. NPC has made plans for the next 10 years when, with the completion of 37 projects, another 58 million tons will be added to the annual petrochemical output capacity,” he added, stressing that the projects require an investment of $40 billion.
The petrochemical industry has improved tremendously in the past four decades and its capacity has risen from 1.5 million tons a year to 90 million tons per year.
“The production capacity of petrochemical industry is likely to increase to 200 million tons in 10 years,” he said.
Referring to last year’s output and exports, Abbaszadeh said production reached 35 million tons, of which 25 million tons were exported.
“We now have 30% of the installed capacity of the Middle East and about 3% of the capacity of the world's major products. With the help of the ongoing and future plans, we are trying to increase these capacities,” he said.
New Catalysts
Commenting on the performance of the Petrochemical Research and Technology Company, affiliated to NPC, in gaining the knowhow to produce catalysts used in the petrochemical industry, Abbaszadeh said this year, new catalysts will be unveiled.
According to the latest reports, all catalysts in the petrochemical industry will be indigenized with the help of Iranian experts and engineers in three years.
Given its 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.
As several projects are underway to increase petrochemical output, Iran’s annual revenues from the industry are expected to grow by 230% in five years and reach $50 billion by 2027.
Major petrochemical complexes are mostly concentrated in the cities of Mahshahr (Khuzestan Province) and Asalouyeh (Bushehr Province).
About 920,000 people are active in the industry and a rise in NPC production by 1 million tons can create jobs for at least 170,000 more people.
He noted that over 30 projects have been planned to reduce the import of petrochemical products worth $1 billion.
Annually, about $1.5 billion worth of petrochemical products are imported. However, with the help of 33 development projects, their import will decline by 70%.
“NPC has invested close to $80 billion in petrochem projects over the past four decades,” he said, adding that $25 billion are expected to be invested in the key sector in the next four years.
Abbaszadeh noted that petrochemical revenues from exports and domestic sales in the past seven years exceeded $110 billion, noting that as petrochemical production rises, less crude oil will be exported.
Unlike other major industries that have not grown over the last four years primarily due to the US economic siege, petrochemical output is rising and production capacity is near 75 million tons a year.
