To complete the value chain in the petrochemical sector, the National Petrochemical Company has issued directives for raising ethylene production in petrochemical complexes in the port city of Asalouyeh, Bushehr Province, NPC’s director for projects said.
"Petrochem complexes, namely Kavian, Morvarid, Jam and Arya Sasol, have been commissioned to increase their ethylene output gradually by 30% in maximum two years, in which case the country's annual output will amount to 12.7 million tons," Ali Mohammad Bosaqzadeh was quoted as saying by NPC’s news agency NIPNA.
According to the official, the short-term plan, whose feasibility studies have been finalized, is aimed at completing value-added chain for olefin products.
Giving a breakdown on the venture, he noted that Arya Sasol is expected to boost its ethylene production by 10% in 2019 and the rest should materialize by 2020.
Morvarid Company is all set to hit the target by the end of 2019 due to technical changes in the setting of furnaces. Kavian and Jam complexes have also planned to expand output by 10% by 2019.
“As soon as more South Pars Gas Field phases in the Persian Gulf become operational by March 2019, more ethane will be supplied to petrochem complexes,” he said, noting that the plan to raise ethylene output depends on the delivery of more ethane, as the feedstock for ethylene.
“In view of the imminent launch of the remaining South Pars phases [11, 13, 14, 22-24], the mega project is predicted to have excess ethane production in two years.”
Bosaqzadeh noted that Iran’s annual ethane production is currently 4.5 million tons, which will reach 6 million tons in a year and 10 million tons in three years. Domestic demand for ethane amounts to 5.5 million tons currently.
Ethylene is the building block for a vast range of chemicals, from plastics to antifreeze solutions and solvents, and is also used in the agriculture sector for ripening fruits.
With an estimated global output of over 150 million tons in 2016, ethylene is the most commercially produced gaseous compound.
"In the last six years, the commodity's production has experienced a twofold rise, exceeding 8 million tons per year compared to that of 2013 at 3.5 million tons. Plans are in place to increase the output to 12.7 million tons in 2019. Petrochem companies will produce as much as 17.6 million tons of ethylene by 2020," he said.
The official believes that developing the ongoing plans, including the first phase of Bushehr Petrochem, the Persian Gulf Bidboland Refinery in Khuzestan Province, Parsian Sepehr Refinery in Fars Province, as well as the second phase of Kangan Petro Refining Complex in southern Bushehr Province, will add 5 million tons of ethane to the country's petrochem output.
Petrochemicals accounted for 34.7% of Iran’s non-oil exports in the last fiscal year (ended March 2018). The industry has achieved continuous growth in the past five years, such that petrochemical complexes have increased from 43 plants to 53, installed capacity has reached 64.9 million tons per annum from 59.8 million tons and production hit 44 million tons from 41.3 million tons per year.
Most Iranian petrochemical infrastructures are in southern regions close to the Persian Gulf where water supply is less of a concern and proximity to international waters makes shipment more cost-effective.
Iran holds some of the world's largest crude oil and natural gas reserves, but its petrochemical industry is comparatively underdeveloped.
Tehran says its new petrochemical ventures require over $70 billion in investments.
