Iran plans 5 refinery projects in Asia, including Malaysia

Kuala Lumpur, Malaysia | June 12, 2007 by D-8 Secretariat

Iran plans to tie-up with Asian companies to build five refineries in the region as part of its efforts to boost energy cooperation, Iran's oil minister said on Monday. 

With China and India expected to become giant oil consumers in the next 20 years, the focus in the oil market has shifted from the west to Asia, said Iranian Minister of Petroleum Kazem Vaziri Hamaneh. 

Iran is finalising five Asian joint-venture refinery projects in China, Indonesia, Malaysia, Singapore as well as Syria, he said. Altogether they would have a total capacity of 1.1 million barrels a day. According to the plan, Iran will seek to be the partner and also provider for the crude oil to these refineries.

The projects, which will be undertaken by the National Iranian Refining and Distribution Co., mark Iran's efforts to expand in Asia, which currently accounts for about 40 percent of Iran's exports, said oil ministry official Javad Yarjani. 

He said Iran is currently involved in only one project in the region, with a minor 16 percent stake in India's Madras Refineries Ltd., now known as Chennai Petroleum Corp. Ltd. 

By 2014, Iran wants to raise its oil production capacity to 5.3 million barrels a day from 4.3 million now, and for natural gas to 1.5 billion cubic meters a day, from 560 million currently, Hamaneh said. 

"Iran would need US$93 billion (euro68 billion) in foreign investment and more than US$43 billion (euro31 billion) in domestic financial resources by 2014. The country cannot meet that level of investment and technology needs on its own,'' he said. 

In addition, Iran needs another US$12 billion (euro8.8 billion) investment to raise its refining capacity from 1.625 million barrels a day to 2.94 million barrels in the next 5 years, he added. 

Hamaneh said Iran is also in the process of signing contracts to expand its own refining capacity. 

The country, despite sitting on one of the world's largest crude reserves, is an importer of gasoline. 

He said Iran's giant South Pars gas field project, which will be developed in 24 phases, is expected to produce 751 million cubic meters of natural gas a day when completed by 2014.  

Five phases are already on stream, five will be completed by the end of the year, another 8 by 2011, and the rest by 2014, he said.

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