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May 14 2009

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Faster Petchem Privatization Sought

President Mahmoud Ahmadinejad has called on oil officials to speed up privatization of petrochemical companies and to show financial transparency.

The Poul newspaper quoted Seifollah Jashnsaz, the head of National Iranian Oil Company (NIOC), as also saying that talks with Shell , Repsol and Total were continuing on their participation in major energy projects.

Jashnsaz said Iran's oil output capacity now exceeded 4.3 million barrels per day and also predicted a higher oil price in coming months.

"The president called for transparency in NIOC's financial dealings (with other entities within the country's oil industry)," Jashnsaz said, adding that the president had also urged faster privatization of petrochemical units.

Iran's oil-dependent economy is dominated by the state but the government has been seeking to speed up sell-offs, including of firms in the downstream oil and gas sectors.

Last month, Jashnsaz said Iran had given Royal Dutch Shell and Repsol until May 20 to clarify their involvement in a major natural gas project in the Persian Gulf.

"These companies have still time to take part in South Pars projects and that is why negotiations continue," Poul quoted him as saying.

The Persian LNG project concerns development of production and exports of liquefied natural gas from a part of the South Pars field in the Persian Gulf. Repsol , Shell and NIOC signed an initial deal in 2002 to develop Phase 13 of South Pars.

Last year, Royal Dutch Shell delayed decisions on multi-billion dollar investments in Iranian LNG plans due to political tension. Repsol has large investments in Iran.

Agreements
Iran has reached agreements with companies from South Africa, Turkey, Indonesia and India to develop six petrochemical projects, National Iranian Petrochemical Company (NIPC) managing director told Mehr News Agency.

"The Olefin 12th unit in the Persian Gulf Petrochemical Complex will be built in cooperation with the South African Sasol Company in Assaluyeh," Adel Nejad-Salim said, adding that the project will come on stream in four years.

According to him, Sasol had previously cooperated with NIPC for the construction of the Olefin 9th unit in Arya Sasol Petrochemical Complex .

" NIPC has also reached agreement with a Turkish company to launch a methanol production unit in Assaluyeh with an estimated annual output of 1,650,000 tons."

He added that a polyethylene production unit with a production capacity of 300,000 tons will also be constructed in the city of Mahabad in collaboration with another Turkish firm.

"An Indian firm will build an ammoniac and urea production unit in Assaluyeh with the annual production capacity of 1 million tons," he said. "National Iranian Gas Company, NIPC and an Indonesian company are to construct an ethane recovery unit near Parsian Gas Refinery in Assaluyeh with the annual production capacity of 1,300,000 tons."

He concluded by saying that an Indian company has agreed to construct an ethylene propylene diene monomer unit with the production capacity of 40,000 tons per year.