Venezuela Given Ultimatum over Delayed Project

Venezuela Given Ultimatum over Delayed Project
Venezuela Given Ultimatum over Delayed Project

Venezuela was given a last warning by the National Petrochemical Company (NPC) to complete the Veniran petrochemical complex in Iran.  The joint project is nearing its seventh year of development, Mehr news agency reported.

The repeated delays of Venezuelan investors to fulfill their commitments in the project prompted the NPC to end cooperation with the South American contractors.

The Rouhani administration has given the green light to European firms to resume operations in the oil, gas and petrochemical industries, whereas talks with South American nations have made little headway.

Former president Mahmoud Ahmadinejad and the late Venezuelan leader Hugo Chavez agreed on the construction of the Veniran complex in Asaluyeh in southern Iran 7 years ago with a production capacity of 1.65 million tons per year.

The new methanol-producing plant was to be built in cooperation with Venezuelan investors in 3 years, but the project has yet to be completed. Veniran in the Pars Special Economic Energy Zone was touted as the biggest Venezuelan overseas oil contract at the time.

The NPC and the Venezuela’s state-owned Pequiven each hold a 49 percent stake in the project.

The remainder is shared by Iran’s Petrochemical Industries Investment Co. (PIIC) and Venezuela’s International Petrochemical Holding Ltd. (IPHL).

The complex needs approximately $500 million of investment according to estimates, but has made little progress in the past seven years as the funding resources are still unclear.

Iran and Venezuela signed several gas, oil and petrochemical agreements during the Chavez era, such as establishing a joint oil tanker company, developing oil and gas fields in the two countries (phase 12 of South Pars in the Persian Gulf and Venezuela's Dobokubi) and building an oil refinery in Syria, but the joint projects have yet to come to fruition.

Project manager of NPC, Marzieh Shahedayi said that Iran was to carry out a similar project in Venezuela, but the project is in limbo.

In view of the slow progress of the Veniran project, NPC will consider replacing the Venezuelan investors, she noted.