By Malini Hariharan
The recent sanctions are making business operations difficult for Iranian petrochemical producers. And just when questions were being raised about the prospects of the country's numerous projects, news has emerged that Iran and China are on the verge of finalizing a pact which will see China invest money in Iranian petchems.
The amount is not very significant - the expected investment is likely to be around $1bn, according to a news report which is a fraction of what Iran needs to develop its petrochemicals sector. But it is an indication of the close relations that the two countries are moving closer across the energy value chain.
Iran is the third largest exporter of crude oil to China, behind Saudi Arabia and Angola. And it has also emerged as a major exporter of petrochemicals such as polyethylene.
Earlier this month the Chinese vice premier told the visiting Iranian oil minister that China was willing to work hard with Iran. China is also reported to have told the US that its trade dealings with Iran should not be criticized.
Pic source: Xinhua
With American and European companies out of the picture, Iran is desperately trying to woo companies from other parts of the world. National Petrochemical Co (NPC) is said to be in talks with Turkey's Petkim for a methanol project. It is also trying to put together urea and ammonia projects with companies from Oman and Indonesia, three petrochemical plants with Russia's Sibur and the Bushehr petrochemical project with Sasol.
Whether these companies will really work with Iran is debatable as they would antagonizing the US which is increasingly getting tough with companies that do business with Iran.