Call for Building Oil Terminals Along Makran Coastline

Call for Building Oil Terminals Along Makran CoastlineCall for Building Oil Terminals Along Makran Coastline

Iran needs to build new oil terminals along its southern coasts to meet its rising crude export capacity, as it aims to challenge rival producers for market share, the first vice president said.

"There are some key strategic plans for the [development of] coasts of Makran, such as embarking on shipping crude oil outside the Persian Gulf and from the southeastern coasts," Es'haq Jahangiri was also quoted as saying by Shana.

The official was on a visit to Makran's petrochemical and steel production plants on Thursday.

Jahangiri's statements are a fresh call for diversifying the country's oil terminals that are largely concentrated in the Persian Gulf region.

In contrast, Iran's Makran shores stretching along the Sea of Oman have barely developed into trade and shipping hotspots, save for the port city of Jask that is slowly turning into an oil and gas terminal.

New oil loading facilities on the coasts of Makran would significantly reduce shipping costs for Iranian and international vessels and spare them a lengthy voyage through the Strait of Hormoz all the way to Iran's main oil and gas terminals, including in Asalouyeh, Kharg Island and Mahshahr in the westernmost side of the Persian Gulf.

  Oil Exports

Iran exports most of its crude from the Kharg Oil Terminal. In February, three international vessels carried 4 million barrels of crude from the island to refineries in Europe. The shipments were ordered by France's Total, Spanish Refiner Cepsa and Lukoil—Russia's second-largest oil company.

The Middle East nation has more than 50 oil tankers, with around 25 tankers reportedly parked in sea lanes and ready for operation close to Asalouyeh and Kharg terminals.

Iran used to pump up to 4 million bpd of crude, but sanctions introduced by the US and the EU against its nuclear program reduced the output to around 2.5 million barrels as exports fell to barely above 1 million bpd from more than 2.5 million barrels per day.

Makran shores are also planned to accommodate new petrochemical complexes, which will help boost the economy of the underdeveloped Sistan-Baluchestan and Hormozgan provinces.

  Regional Development

Jahangiri also called for accelerating the development of Chabahar Petrochemical Complex project, in addition to a bevy of projects in the promising port city, which have drawn the interest of Indian and Japanese investors.

The first phase of Chabahar petrochemical project will raise petrochemical production capacity by 8 million tons a year upon completion.Sistan-Baluchestan's Governor General Ali Osat Hashemi also said his province can be at "the forefront of development" in Iran's economy, if its infrastructures such as railroad and ports are developed.

Iran's massive crude oil and natural gas reserves have fueled the economy of its southwestern cities in the Persian Gulf region, but areas bordering the Sea of Oman in the southeast have gained little from the massive hydrocarbon reservoirs.