Corrected: Iran to double refinery capacity by 2012

19 May 2008 16:12  [Source: ICIS news]

Correction: In the ICIS news story headlined "Iran to double refinery capacity by 2012" dated 19 May 2008, the tables at the end of the article had errors. A corrected story follows.

 

By Steve Tan

 

TEHRAN (ICIS news)--Leading crude oil exporter Iran plans to double its refining capacity to 3.3 million bbl/day by 2012 in a massive expansion and upgrading programme, a senior Petroleum Ministry official said on Saturday.

 

The country’s constrained refinery capacities have been outpaced by rapid domestic growth in demand for products such as gasoline, gasoil and kerosene.

 

Gasoline consumption had been growing at a steady pace of around 10% a year for the past decade, necessitating the import of up to 36 million litres/day of gasoline in 2007, said Mohammad Reza Nematzadeh, Deputy Petroleum Minister and president of National Iranian Oil Refining & Distribution Co (NIORDC) at the 8th Iran Petrochemical Forum (IPF).

 

Gasoil imports could hit 12m litres/day this year from around 8m litres/day, he added.

 

“These realities actually forced us to decide to increase our local refinery capacity,” said the deputy minister, adding that pipelines and storage facilities would also be built in line with the expansion and upgrading of refinieries.

 

He cited the Abadan refinery, located in western Iran, as one of the refineries currently undergoing upgrading works including the addition of a fluidised catalytic cracker (FCC).

 

The unit would have a throughput capacity of 45,000 bbl/day of which gasoline production would total 35,800 bbl/day while propylene production would total 2,800 bbl/day.

 

One of the new refineries on the list, the Caspian refinery, is expected to use imported crude oil from the oil-rich region instead of using domestic oil from central and southern Iran.  

 

After expansion works and the addition of new refineries, the product slate of the new refineries will be changed to benefit light distillates such as gasoline.

 

By 2012, the planned gasoline production in Iran will form 35% of refining capacity, up from 17% currently.

 

He also projected Iran to become a net exporter of gasoline by 2010 given the refinery expansions in the cards.

 

In addition to this, NIORDC is involved in investments overseas which include a 30%stake in a 250,000 bbl/day refinery in Malaysia, a 40% stake in a 300,000 bbl/day refinery in Indonesia and a 26% stake in a 140,000 bbl/day refinery in Syria.

 

In terms of logistics, the planned Neka-Jask pipeline will span more than 1,500 km with a capacity of 1m bbl/day, linking the coastal city of Neka on the Caspian Sea down to the coastal city of Jask on the Gulf. 

 

It is now in conceptual design and the route is being finalised, he said, adding that it an award for the engineering, procurement and construction work is expected by year-end.

 

Iran is a member of oil cartel OPEC and has the second largest crude oil reserves in the world after Saudi Arabia. The IPF, held in Tehran on 17-18 May, saw 1,350 delegates from close to 30 countries attending.

 

Expansion and upgrading of existing refineries

Refinery	Throughput increase	Progress (%)	Investment
Abadan (FCC)	45,000 bbl/day	43	€400m
Arak	80,000 bbl/day (+70,000 bbl/day gasoline)	13.7	€2.4bn
Isfahan	0  (+85,000 bbl/day gasoline)	3.9	€2.4bn
Lavan	20,000 bbl/day	EPC award	€300m
Tehran	(+12,600 bbl/day gasoline)	na	na
Tabriz	(+6,300 bbl/day gasoline)	na	na
Bandar Abbas	(+25,000 bbl/day gasoline)	na	na

New refineries

Refinery	Capacity	Progress (%)	Investment
Persian Gulf Star Oil	360,000 bbl/day (condensate)	11	€2bn
Hormuz	300,000 bbl/day	3	€4bn
Khouzestan	180,000 bbl/day	Basic design	€2.5bn
Pars	120,000 bbl/day	Basic design	€900m
Shahriyar	150,000 bbl/day	Basic design	€1.5bn
Anahita	150,000 bbl/day	Basic design	€1.5bn
Caspian	300,000 bbl/day	Basic design	€3bn

 ($1 = €0.64)

 

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By: Steve Tan
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