Shazand Petrochemical Company has received more than $6.7 million in frozen revenues from foreign banks after the implementation in January of the nuclear agreement with the six world powers, officially known as the Joint Comprehensive Plan of Action, the company's managing director said on Saturday.
“All Shazand unpaid dues have been cleared,” Khodadad Gharibpour was quoted as saying by IRNA. Referring to exports of 561,000 tons of petrochemicals from the company, Gharibpour added that negotiations with banks to help petrochemical complexes receive their bills from exports has produced results and unpaid dues were settled.
Iran earned $14 billion from petrochemicals in the last Iranian year that ended in March, including $9.4 billion from exports, mostly to China and Europe, according to data released by the state-run National Petrochemical Company.
The lifting of international sanctions imposed over the nuclear dispute has enabled Tehran to get back billions of dollars in frozen assets and revenues.
Feedstock Challenge
Asked about the challenges related to the steady supply of feedstock to petrochemical plants, Gharibpour noted that Isfahan and Shazand refineries will provide the Shazand Petrochemical Complex with feedstock, including liquefied petroleum gas.
Shazand refinery is in the city of Arak in Markazi Province. As these refineries first priority is to supply gasoline for the domestic market, they usually fall short of delivering enough liquefied feedstock to the Shzand complex, resulting in reduced output.
Underscoring the fact that the plant's daily need for LPG is 300 tons, the official added, "The feedstock demand is met from different sources with difficulty, but we hope that Arak Refinery can help in this regard."
According to Marzieh Shahdaei, managing director of National Petrochemical Company, plans call for increasing petrochemical plants' feedstock with the help of their adjacent refineries. She says that tapping into refineries excessive feedstock is on the agenda. To be more specific, Arak, Tabriz and Isfahan petrochemical plants, which are near refineries, will expand their capacity as the said refineries have been tasked to supply as much feedstock as they require.
Main Priority
"As long as the Persian Gulf Star Refinery, the Middle East's largest oil refinery which is under construction in the southern port city of Bandar Abbas, has not come on stream, Arak and Isfahan refineries' main priority will be gasoline," she said, noting that the PGS Refinery, which will be completed next year, can meet the country's total domestic demand for gasoline.
The NPC chief opined that with an increase in South Pars Gas Field output, more natural gas as feedstock will be available for petrochemical complexes, stressing that by supplying feedstock, units not operating due to lack of feedstock will go on stream and increase the industry’s production capacity.
Recalling European and East Asian companies’ interest in financing petrochemical projects, Shahdaei said, “These companies, which had good relations with Iran in the pre-sanctions period and were forced to leave due to international sanctions, have expressed interest in returning and cooperating in our projects.” She did not name the companies.
The official stressed that negotiations with foreign companies on technology transfer and upgrading the plants are also underway.
Nominal petrochemical production capacity is close to 60 million tons a year, with actual output reported at 40.5 million tons, 44.5 million tons and 45.6 million tons over the past three years. Actual output is expected to reach 50 million tons this fiscal that ends in March 2017.
