Iran Mulling Tender for Mini LNG Plants

The National Iranian Gas Company (NIGC) is planning to hold international tenders for several small-scale liquefied natural gas projects, also known as mini LNG, Hamidreza Araqi, the company’s chief executive officer said.

“We do not have the technology to develop mini LNG plants. Therefore a tender is scheduled to be held in few months to develop the first such plant in Iran,” Araqi was quoted as saying by ISNA on Monday.

The official said that German chemical producer Linde Group is poised to make a bid for the  mini LNG project in collaboration with an unnamed Japanese firm.

Linde, the world’s largest industrial gas company by market share as well as revenue, has been exploring investment opportunities in Iran’s petrochemical industry after international economic sanctions were lifted last year.

According to a published report, almost 70% of Iran’s petrochemical machinery is manufactured by Linde and Siemens.

“We aim to push forward our LNG ambitions from different spheres,” Araqi said, referring to an agreement between the Research Institute of Petroleum Industry (RIPI) and state-owned Korea Gas Corporation on studying the feasibility of a small-scale LNG plant in Iran. RIPI is the research and development arm of the Oil Ministry.

“Partnering with a local company and transferring knowhow for building mini LNG plants will be the prerequisite for the prospective tender,” said the NIGC chief noted.

This is in line with national policy to place domestic companies next to international giants in oil, gas and industrial projects.

Production capacities of small scale LNG plants vary in the range from 2,000 up to 500,000 tons a year. By comparison, a typical large-scale plant has a production capacity of between 2.5 and 7.5 million tons of LNG per year.

With limited production capacity, mini LNG plants are suitable for the supply of small amounts of liquefied gas to far-flung regions using tanker trucks.

 Russia’s Gazprom, the world’s largest gas producer, has also held talks over producing LNG in Iran.

After holding talks with Araqi in Tehran last month, Alexander Medvedev, deputy chief executive of Gazprom said his company is ready to play a role in Iran’s gas supply chain.

“We are willing to take part in LNG liquefied natural gas production and exports”, Medvedev said after meeting Araqi in Tehran in December.