Private Sector to Take Over Export of Oil Byproducts

The government is mulling plans to delegate export of petroleum products, including compressed natural gas (CNG), to the private sector, Mansour Riahi, managing director of National Iranian Oil Products Distribution Company (NIOPDC) said.

“In line with a recent decree by the oil minister (Bijan Namdar Zanganeh), the government is ready to entrust the export of oil byproducts to private companies while maintaining its administrative and regulatory role,” Riahi was quoted as saying by Mehr News Agency on Tuesday. 

He did not elaborate on the details.

The plan seeks to allow private companies to handle operations for the transfer and storage of oil byproducts in export terminals.

According to the official, the step-by-step changes in NIOPDC structure are part of efforts to privatize Iran's energy market which is largely dominated and operated by the government bureaucracy.

“Based on NIOPDC development plans, the government should assume a supervisory role," he said.

  CNG Industry 

Riahi noted that the government policy is to introduce a roadmap for increasing the role of private enterprise in the CNG industry.

“Gone are the days of government involvement in the CNG industry. The time has come for the private sector to engage in CNG production and distribution.”

Referring to the need to establish a consortium of private companies in the CNG sector, Riahi said that the NIOPDC, as a state-owned company, is also planning to commercialize and privatize CNG stations across the country.

The company seeks to supply CNG to 2.5 million more rural people in addition to raising the share of the clean fuel in the domestic transportation network. 

Ali Mehrabi, director of CNG stations construction at the NIOPDC, told IRNA earlier this year that the number of CNG stations nationwide has reached 2,335 and plans call for increasing the stations by another 50 by March 2017, the end of the current Iranian fiscal year.

CNG stations can supply over 2.66 million cubic meters of compressed natural gas per hour.

CNG is an alternative to gasoline which is made by compressing natural gas to less than 1% of its volume at standard atmospheric pressure.

Over the past decade, consumption of CNG in Iran has grown 53-fold as domestic carmakers have retrofitted and are producing vehicles that run on CNG along with gasoline as the primary fuel.