Iran's Petrochemical Exports to Exceed 20m Tons by March

Export of petrochemicals will exceed 20 million tons by the end the current fiscal (March 2017), Farnaz Alavi, a member of the board of the state-run National Petrochemical Company, said Monday.

With reference to the upward trend in Iran's petrochemical output, Alavi noted that petrochemical production capacity is around 65 million tons a year, yet plans call for boosting capacity to 130 million tons per annum by 2020 before reaching 180 million tons annually by 2025, Shana reported.

"Last year's petrochemical output stood at 46.5 million tons," she said, noting that 29 million tons of petrochemicals was produced in the first nine months of the current fiscal that roughly coincides with March-December.

Production of petrochemicals and polymers is expected to surpass the 50-million-ton mark by March.

According to Alavi, during the first seven months of the current year, 11.6 million tons of petrochemicals and polymers were exported and 8.5 million tons sold in domestic market.

The lion's share of outbound petrochemicals went to Asia, Europe and South America.

Iran exported $9.6 billion worth of petrochemicals in its previous fiscal, the official said, predicting lower revenues of around $9 billion in the present fiscal from petrochemical export.

The official said that fluctuations in global energy markets have led to a decline in revenue from petrochemical exports. She noted that over the past two and a half years, oil prices plummeted by a whopping  50% on average.

In the same period prices of Iran's gas feedstock, methanol, polymers, and aromatics crashed by 66%, 40%, 55% and 50% respectively.

Commenting on the private sector role in expanding the industry, the official said petrochemical plants  are being privatized so that the private enterprise can play a more effective role in this sector.

Officials say Iran's fast emerging petrochemical industry needs $72 billion in foreign investment for 80 major petrochemical projects in line with plans to triple petrochemical production over a decade.

--- Non-Oil Exports

According to First Vice President Es’haq Jahangiri, petrochemicals make up around one-third of Iran's non-oil exports, which shows why hurdles on the road to export expansion needs to be removed.

Ahmad Mahdavi, the head of Iran's Association of Petrochemical Industry Corporation, recently said Iran is planning to raise the share of petrochemical products in its non-oil exports to 35% from 33% the year before.

Iran is offering subsidized feedstock as well as tax exemptions and free land to foreign companies to build petrochemical plants. Iran sits on the world’s second largest natural gas reserves and the fourth-largest crude reserves, holding 34 trillion cubic meters of gas and 158 billion barrels of proven oil reserves.