NPC Selling 80% Stake in Damavand Petrochem Plant

The National Petrochemical Company (NPC) is planning to sell a majority stake in Damavand Petrochemical Plant which is under development in the southern port city of Asalouyeh, Bushehr Province.

According to Jafar Sobhani, a senior advisor to the Iranian Privatization Organization, the IPO is finalizing the sale of Damavand plant, NPC's official news portal reported on Monday.

“Applicants have submitted documents and received the approval… the contract is expected to be signed in the near future,” Sobhani said. According to reports, NPC will sell 80% share in Damavand Petrochemical Co. to the Persian Gulf Holding Company, Parsian Oil and Gas Company and one unknown buyer, and will retain only 20% stake.

Hussein Shahriari, director of Damavand Petrochemical, expressed optimism that the deal will accelerate the plant's construction, which is set to become one of the largest petrochemical units in Asalouyeh.

"The complex was expected to come on stream in the previous Iranian fiscal. But it hit a financial and operation roadblock, mainly due to the prolonged process of its sale."

Shahriari added that 16 trillion rials (around $42 million) is needed for completing the project. “A large part of the funds will be made available by the new shareholders.”

Iran's annual petrochemical production capacity is around 65 million tons, but plans call for boosting the capacity to 130 million tons by 2020 before reaching 180 million tons by 2025.

Tehran has said it needs $72 billion in foreign investment for 80 major petrochemical projects.