Petrochem Sector Needs $72b in Foreign Investments

Iran wants to attract $72 billion in foreign investment for 80 major petrochemical projects in line with plans to triple petrochemical production over a decade, the top petrochemical official said in a conference in Germany on Thursday.

"We have 80 petrochemical projects, including 30 new ones, that require investment under the sixth five-year economic development plan (2016-21)," Marzieh Shahdaei, head of state-run National Petrochemical Company said at "K 2016" trade fair in Dusseldorf which is focused on the international plastics and rubber industry, Shana reported.

The 30 new projects aimed at raising petrochemical output capacity by  50 million tons a year, need roughly $40 billion in foreign investment, she said, adding that the 50 existing projects, with a planned annual production capacity of 41.3 million tons, require more than $32 billion for completion.

Iran's petrochemical production capacity is around 60 million tons a year. Tehran hopes to boost the capacity to 130 million tons a year by 2020 before reaching its lofty goal of 180 million tons per annum by 2025. According to Shahdaei, Iran holds 38% of the petrochemical market in the Middle East, but only produces 4.8% of the world's petrochemicals a year despite sitting on some of the world's largest crude oil and natural gas reserves.

Economists, academia and social scientists have for decades appealed to governments and policymakers to use the huge crude and natural gas reserves to produce quality petrochemicals with a higher value-added. The calls in line with the crucial need to strengthen and diversify the   economy that is largely dependent on the vulnerable and unstable oil export revenues.