The construction of the first phase of Persian Gulf Hoveyzeh Gas Refining Company is nearly complete and the facility that aims to collect associated petroleum gases from several oil and gas fields will be launched in the coming weeks, the oil minister said.
Also known as NGL 3200, the refinery is located in Hoveyzeh County, Khuzestan Province.
Upon its inauguration, “the refinery will be fed with 7 million cubic meters of flare gas on a daily basis from West Karoun fields, including North and South Azadegan, Yadavaran, North and South Yaran, Sohrab, Sepehr, Jofair and Susangerd, which will be transformed into added value,” Javad Owji was also quoted as saying by the Oil Ministry’s news service Shana.
“A total of $1.3 billion have been invested in the project and it has created employment for 5,000 people,” he added.
The project is being carried out by the National Iranian Oil Company using the capabilities of domestic contractors. When fully operational, it will have a total processing capacity of 14 mcm per day.
Natural gas liquids or NGLs are components of natural gas separated from gas in the form of liquids. Ethane, propane, butane, isobutane and pentane are all NGLs used for a variety of purposes like inputs for petrochemical plants, burned for space heating and cooking, and blended into vehicle fuel.
APG, or flare gas, is gas dissolved in oil. It is a mixture of hydrocarbons obtained from oil extraction and separation processes. The gas can be utilized in a number of ways after processing: as feedstock for the petrochemical industry and for gas distribution networks.
Its collection is an important safety measure at many oil and gas production sites, as it prevents industrial plant equipment from over-pressuring and exploding.
Slow Progress
Iran has made progress in using flare gas either for power generation or as feed for refineries and petrochemical plants. Reports say the government has invested $5 billion in related projects.
The Oil Ministry has implemented several measures to reduce gas flaring, such as collecting APG for injection into oil and gas wells, as well as converting it into petroleum products like natural gas liquids and for power production.
Since 2008, Iran has prevented the flaring of 12 billion cubic meters of APG, a source of global warming and waste of valuable fuel.
Despite these measures, Iran has the highest rate of energy waste in the form of APG in the Middle East and ranks third in the world in terms of gas flaring after Russia and Iraq.
According to official reports, approximately 17 bcm of gas are still flared and wasted annually in Iran.
APG collection projects have been designed for preventing gas flaring, preserving the environment, creating added value from gas collected from the fields, especially those in the east of Karoun River and providing sustainable feed to petrochemical companies.
There are still oilfields where APG is burned off in flares, but negotiations are underway with more local firms to collect it. The ongoing initiatives are expected to be completed over the next three years.
According to the programs, by the end of the current Iranian year (March 2024), about 18 mcm per day of APG are expected to be collected from various fields.
In 2025 and 2026, another 17 mcm and 7 mcm per day of flared gas will be reduced. In other words, the country plans to reduce 50% of flared gas by the end of this year and the remaining APG will be collected by 2026.
