35% Siraf Shares to Be Offered at Bourse

35% Siraf Shares  to Be Offered at Bourse 35% Siraf Shares  to Be Offered at Bourse

Close to 35 percent of Siraf refineries' shares will be offered on the bourse, said an official at National Iranian Oil Refining & Distribution Company (NIORDC).

The construction of eight Siraf refineries, which are said to be the biggest gas condensate refining complex in the Middle East, is due to commence early next year (beginning March  2015), Mehr news agency quoted Shahabeddin Motaji, NIORDC managing director for comparative planning, as saying.

The complex will be constructed by the private sector, with a refining capacity of 480,000 barrels of gas condensates per day (60,000 per refinery). Construction cost of each refinery is estimated at $265 million. Added to this figure is the general utility expenditure and the final cost will be around $300 million.

"Investors with medium-size capital can cooperate in the project," Motaji said noting that: "With profits to be gained in future, investors can produce products which have specific customers."

The 60,000 barrels production capacity comprises of 3,000 barrels of liquefied gas, 16,000 of light naphtha, 18,500 of heavy naphtha, 3,700 barrels of jet fuel and 18,700 barrels of diesel fuel.  Proximity to the export hub, reduction of costs relating to export terminal construction and gas feedstock transportation, availability of water from the Persian Gulf, and access to Assalouyeh power plant are among the advantages of Siraf complex, according to Motaji. Also, costs to invest in construction of desulfurizing and gas purification facilities have been reduced to a large extent. As stated in the call for public participation, investors are required to offer 35 percent of their shares in a maximum in one year after the refinery comes into operation. The refineries are projected to be built in three to four years. The ministry had previously called on investors and contractors to join the project. From 54 private firms who bid for the Siraf refineries, eight will be chosen. Winners will be announced this week.

Companies can apply for loans from the National Development Fund of Iran (NDFI), but this does not mean that the project can or should solely rely on the NDFI, Motaji said last week, underlining that: "Investors must secure financial resources through their own means."

 The ministry broke down the large Siraf refinery contract into eight smaller ones to help raise funds for the construction phase.