Japan's Itochu, Iran's PGPIC Sign Polyethylene Deal

Japan’s Itochu Corporation signed a deal on Saturday to purchase 11,000 tons of polyethylene per month from the Persian Gulf Petrochemical Industries Company (PGPIC).

The two sides signed the agreement on the sidelines of the 22nd International Iran Oil, Gas, Refining and Petrochemical Exhibition in Tehran, Shana reported. Mohammad Hossein Kakouei-Nejad, an executive at the PGPIC, said the deal is worth $150 million a year. Itochu Corporation is Japan's second-largest general trading company after Mitsubishi Corporation. It is active in a variety of sectors, namely energy, chemicals, machinery, metals, minerals, food and textiles.

The deal comes after the two sides signed a preliminary deal in December 2016, based on which Itochu agreed to lend €320 million ($341 million) to PGPIC for infrastructure development, IRNA reported. The official added that polyethylene shipments will begin "within the next few months."

Kiyoshi Hirayama, Itochu’s representative in Iran, said prior to the tightening of international sanctions in 2012, the Japanese company had solid economic ties with Iran.

Hirayama noted that his company is willing to expand business in the Iranian market, including investments in petrochemical projects.