Tehran Seeks $13b Credit Line From German Firms

Negotiations are underway between Iran's National Petrochemical Company and two unnamed German companies to open two lines of credit worth €12 billion ($12.9 billion), NPC's head of financial affairs said on Tuesday.

“In a meet at the Iranian Embassy in Berlin last week, a high-ranking petrochemical delegation from NPC introduced major investment opportunities in Iran's petrochemical sector to a group of German lenders, insurance firms and investment companies with the aim to attracting foreign funds,” Hossein Alimorad was quoted as saying by Shana.

Attaching special importance to the implementation of the Joint Comprehensive Plan of Action, the formal name of the nuclear deal between Iran and major powers reached last year, Alimorad said winning international investors' trust not only to embark on joint ventures but also transfer technology to the country tops the NPC priority list.

According to the official, as per a directive from Bijan Namdar Zanganeh, the oil minister, all domestic and international investment proposals must eventually have approval from the  National Iranian Oil Company.

Highlighting NPC's policies, the official said, "Concerted efforts are being made to attract investment in a way that the government does not need to give guarantees. NPC is not interested in soliciting state-backed guarantees to investors."

Asked about ways to open foreign credit line as soon as possible, he said German banks have proposed to finance two NPC projects and then start talks with the private sector.

Alimorad believes that if Germany's top credit institution Euler Hermes agrees to establish a credit line worth €100 million, it would pave the way for other investors and financial institutions to resume dealings with Iran.

Reportedly, Iran wants to attract $72 billion in foreign investment for 80 petrochemical projects in line with plans to triple petrochemical production within a decade.

According to Marzieh Shahdaei, head of state-run National Petrochemical Company, there are 80 petrochemical projects, including 30 new ones that require investment under the sixth economic development plan (2016-21).

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 that capacity to 130 million tons a year by 2020 before reaching its lofty goal of 180 million tons per annum by 2025.