Iran Petrochemical Forum inaugurated

The 14th Iran Petrochemical Forum (IPF) kicked off at IRIB International Conference Center (IICC) in Tehran on Monday.

The inaugural ceremony of the event was participated by Rouhollah Dehqani-Firouzabadi, the vice president for science and technology, Majid Chegeni, the managing director of National Iranian Gas Company (NIGC), and senior director of the country’s petrochemical sector.

Focusing on “Value Chain, New Opportunities”, the two-day forum revolves around eight topics, including: “Feedstock, products and supply chain”, “Solutions and advanced optimization technologies”, “Integration and coordination between petrochemical and refining complexes”, “Production process and market”, “Methanol market and its roles”, “Global energy crisis and future of the petrochemical industry”, “Investment and financial supply opportunities”, and “Energy optimization and production without pollution”.

As stated by the managing director of National Petrochemical Company (NPC), “Our today’s important objective of completing the production chain in the country’s petrochemical sector highlights the significance of holding this conference”, 

Morteza Shahmirzaei has expressed hope that IPF can pave the way to achieve all strategic petrochemical products in the world.

As reported, 15 countries, including the members of the BRICS countries (Brazil, Russia, India, China, and South Africa) as well as some European countries, are participating in IPF, which is a famous scientific conference in the world, and the latest products and achievements of the petrochemical industry are being presented and introduced in the two-day event.

 

Lifting US sanctions on Iran not an easy job

The most complicated issue in the United States-Iran relationship is the intertwined US sanctions, which were aimed at punishing the Islamic Republic on multiple counts and in the worst possible manner. 

These include from activities related to the nuclear program and support of terrorism to missile proliferation and human rights abuses. Some of Iran’s major institutions, including the Central Bank Iran, were sanctioned, both for their roles supporting the nuclear program and for aiding the alleged terrorist attacks by proxy militias.

The Biden administration wants to lift the sanctions related to Iran’s nuclear program – as promised in the 2015 deal – if Tehran, in turn, rolls back recent breaches of the nuclear deal. The complicating factor in current and future diplomacy is that key Iranian institutions and individuals could remain sanctioned for secondary reasons, thus not providing Iran the economic relief it seeks.

Iran’s oil industry, the country’s main source of export revenue, is a prime example. Biden could lift sanctions on NIOC for its role in funding programs on weapons of mass destruction. But it would remain sanctioned for financially facilitating terrorism orchestrated by the Revolutionary Guards. The same problem of overlapping sanctions could arise in any future talks about Iran’s missile program because institutions involved in proliferation are also sanctioned for supporting regional terrorism.

The Biden administration has the authority to provide temporary exemption from sanctions; it would keep sanctions in place legally but nullify their effects until the Treasury formally revokes sanctions. “Iran is unlikely to be satisfied with such an approach and could demand formal removal of counter terrorism sanctions on these entities, a move that would be hugely unpopular in US domestic circles,” Brian O'Toole wrote for the Atlantic Council.

The issue of sanctions was further complicated when President Donald Trump abandoned the nuclear deal—brokered by the world’s six major powers over two years of intense diplomacy—in 2018. He then re-imposed earlier sanctions from the Bush and Obama administrations that had been lifted when the Joint Comprehensive Plan of Action (JCPOA) was implemented in 2016. He also took the unusual step of sanctioning Iran’s banking and oil sectors for funding the Revolutionary Guards and extremist proxies across the Middle East.

On April 2, Iran has begun indirect talks in Vienna with the United States on returning to compliance with the JCPOA. The Iranian delegation included representatives from the Central Bank of Iran and the Petroleum Ministry, which reflected Tehran’s interest in sanctions relief.

Therefore, there is an urgent need to assess the sanction imposed on Central Bank of Iran, National Iranian Oil Company, National Iranian Tanker Company, National Petrochemical Company, Islamic Republic of Iran Shipping Lines and 18 commercial banks. The filth of more than four decades can’t be cleaned in a few days or months.

Iranian refining and downstream industries flourishing despite sanctions

Persian Gulf Star Refinery (PGSR) located in Iran’s southern province of Hormozgan is the first of its kind. It is based on gas condensate feedstock received from the South Pars gas field which Iran shares with Qatar in the Persian Gulf. As the largest processing facility for gas condensate in West Asia, PGSR has made Iran an exporter of gasoline.

This refinery has increased Iran’s gasoline production to 110 million liters per day, while the country’s consumption is 74 million liters. PGSR has not only made Iran self sufficient in gasoline production, but enabled it to export surplus output. The products exported by the refinery during the first half of the current Iranian calendar year were 120 percent higher than the products exported during the same period last year.

Pars Oil and Gas Company (POGC), responsible for developing South Pars gas field, delivered about 60 million barrels of gas condensate to PGSR during the first half of the current year. PGSR receives 375,000 barrels of condensate daily from South Pars gas field as the feedstock.

Historically, Iran has remained a net importer of gasoline in recent decades and restriction on sale of gasoline was used as one of the tools to pressurize the country. Those sanctions were lifted with the implementation of JCPOA (Iran’s nuclear deal with the world powers, known as Joint Comprehensive Plan of Action), concerns about their return led to construction of PGSR to be pursued more rapidly and in different phases. In January 2019, when the third phase of the refinery was inaugurated, Iran was able not only to eliminate the need to import gasoline but also to export surplus gasoline and bring more income to the country.

 According to Secretary General of Iran’s Oil Refining Industry Companies Association (ORICA) the country’s oil refining capacity has increased to two million barrels per day. The activities of the refineries, in addition to meeting the domestic need, have led to the export of surplus products, which plays a significant role in combating the sanctions.

The Secretary General of ORICA went on to say that in addition to the main products, 32 other special products are produced in the refineries, which are allocated on priority to domestic petrochemical industries.

He highlighted the role of refineries as 32,000 people are directly employed in this sector and now all refineries are run by domestic experts and not a single foreign engineer is employed in this industry.

In the recent past, the quality of domestically produced fuel was not comparable to international standards, but over the last four years the quality of local gasoline has improved so much that ordinary gasoline has replaced super gasoline. It is also worth noting that the country's refineries are operating at optimum capacity utilization.

Lately, Iran’s Karoon Petrochemical Company (KPC) has unveiled two new products that are going to save the country US$27 million. The production lines of two new grades of MTDI and KMT-10 were officially launched with the aim of meeting the needs of downstream sectors and completing the value chain of the country’s petrochemical sector.

KMT-10 is produced by pre-polymerization of methyl phenyl isocyanate and by the formation of urethane groups. With the production of this new product, the petrochemical industry will practically eliminate the need to import similar grades which have been previously imported from China, Japan, South Korea, and Germany. This strategic product has wide applications in the automotive, office, and home appliances industries.

MTDI products include Aradur 830 CH, Aradur 850 CH, and Aradur 2963 CH. Karoon Petrochemical Company has introduced this product in order to meet the needs of downstream producers of paint, resin, and polyurethane and in order to complete the value chain of petrochemical products.

The petrochemical industry is playing a crucial role in Iran's non-oil economy, the second-largest foreign exchange earner after crude oil. Petrochemical exports already make up nearly 33 percent of the country’s non-oil exports.

Head of Iran’s National Petrochemical Company (NPC) Behzad Mohammadi said the country’s petrochemical products basket would be further diversified. The official noted that major development plans were underway for diversifying the country’s petrochemical output considering the wide range of feedstock available.