The National Iranian Gas Company (NIGC) invited Iranian and foreign investors to take part in construction of small and medium-size LNG plants, the company's gas distribution manager said Tuesday.
The NIGC undertakes to provide at an agreed point of delivery the required gas for small and medium-sized LNG plants in the first eight months of the next Iranian year (begins March 21), IRNA quoted Naser Ebrahimi as saying.
Applicants must have experience in industrial production, and funds with the specified capacity, which is to be ascertained by the NIGC.
The investor can decide on the plant's capacity, but location of the site must be confirmed with the NIGC. Moreover, the investor should incur the costs regarding construction of an exclusive gas transfer pipeline.
The public call is aimed at promoting the use of liquefied natural gas (LNG), diversifying gas supply and export practices, and increasing the gas network's stability especially during winter, he noted.
Every prospective producer is obliged to offer at least half of the production at the energy bourse, Ebrahimi said, adding that the storage capacity of each plant is to be determined by the investor.
Monthly price of the gas supplied to small and medium-size LNG plants will stand at $3.3 per British thermal unit (BTU) until March 2021, and from then until March 2026 the figure will be $2.8 less than the average selling price of one million BTU at the bourse. Prices will differ for each production point, Ebrahimi said.
LNG producers and purchasers will be authorized to export. The amount of LNG required by the NIGC, depending on network demand, will be purchased by the NIGC at a price equal to the average selling price of 30 consecutive days at the energy bourse, based on an agreement whereby the amount and delivery times are agreed upon by the both parties.
The investors, with whom an LNG plant construction agreement is signed, are required to issue and submit to the NIGC a guarantee worth three percent of the estimated investment needed for construction of the plant. The guarantee will be released once ten percent of the investment is fulfilled.
Interested parties can submit their applications before February 19.
