Iran Mulls Building Refinery in Spain

Iran Mulls Building Refinery in Spain
Iran Mulls Building Refinery in Spain

Iranian oil officials are mulling over a proposal submitted by Spanish companies to construct a refinery in Spain, managing director of the National Iranian Oil Refining and Distribution Company said on Saturday.

"The proposed refinery will refine 200,000 barrels per day of crude to be supplied by Iran," Abbas Kazemi also told IRNA.

Elaborating on the terms of cooperation, he said, “The two sides will have the same investment share. Iran will cover 50% of the costs and the rest will be met by Spanish companies.”

The official noted that serious negotiations are underway, but they are yet to be concluded.

Referring to the high profit margin of the new refinery, Kazemi said it can generate up to $9 per barrel in revenue.

Pointing to Iran's new policy of either purchasing other refineries' stake or building refining complexes overseas, he said such a policy is aimed at securing long-term crude supply deals in international markets.  

Dismissing claims that investing in refineries overseas is not economically viable, Kazemi said serious negotiations are underway with Brazil, Malaysia, India and South Africa to buy their stocks.

"The construction of refineries in foreign states will help us not only to produce oil byproducts such as gasoline, but also to export them to target destinations regardless of the distance," he said.

Oil experts believe that buying oil and petrochemical refining complexes as well as investing in foreign gas stations can be an effective alternative to relieve economic pressures. They assume that had Iran invested in such projects prior to sanctions, it would be able to easily resist inflationary pressures.

Most Persian Gulf oil producers have already purchased refineries in different parts of the world, which allows them to play a key role in the global energy market, especially during an oil crisis.