Iran in Broad-Based Talks With Western Oil, Petrochem Firms

Companies are expanding talks with western officials on investment and cooperation in the petrochemical industry in line with long-haul plans to raise billions of dollars in foreign investment to develop the fast-emerging sector.

According to the semi-official Mehr News Agency, a delegation of top officials, headed by Marzieh Shahdaei, the chief executive of National Petrochemical Company, met with senior executives of French companies Total S.A. and Air Liquide as well as US-based firm UOP LCC on the sidelines of the K 2016 trade fair in Dusseldorf. The focus of the vent is on the global rubber and plastics industry.

Mehr said licensing and transfer of technology was at the center of negotiations with UOP which is a subsidiary of the American multinational conglomerate Honeywell, producer of a variety of commercial and consumer products, engineering services and aerospace systems.

Iran plans to boost its petrochemical production capacity to 180 million tons a year, nearly three times the current level, by building dozens of new plants for production of propylene, olefin and a wide range of polymers.

The two sides also reportedly discussed cooperation on a propane dehydrogenation (PHP) plant. PDH is an important process step in production of propylene—the second highly-demanded raw material in the world after ethylene used to produce a broad range of chemicals.

UOP is a leading global supplier and licensor for the petroleum refining, gas processing, petrochemical production and major manufacturing industries.

Some 85% of the world’s biodegradable detergents, 70% of polyester and more than 60% of gasoline are produced using UOP technologies, according to the company's website.

Some international restrictions were removed in January, allowing Iran to enter into talks with foreign companies without fear of economic reprisals. But the so-called primary sanctions, which prohibit US firms from conducting business with Tehran, are still in place.

Following the historic nuclear accord between Tehran and the world powers (the five permanent members of the United Nations Security Council and Germany) in July 2015, the government in Tehran has been vocal on its interest in rekindling trade ties with foreign firms, including US-based companies. It comes as Total, which was quick to rebuild ties with Iran after the January removal of sanctions, is poised to sign a $2 billion deal by March to build a major complex for olefin production.

Air Liquide, a French supplier of industrial gases and services to various industries is also interested in financing a 500,000-ton-a-year methanol propylene unit in Iran.