monthly

Iran Petroleum Issue No. 75 September 2018

12th Iran Plast in Tehran Iran Polymer Highly Attractive The growth of polymer and plastic industry in Iran has helped domestic manufacturers find more destinations for their products under any circumstances. The JMMC Established by OPEC-non-OPEC; Not a Decision-Making Body Iran’s Minister of Petroleum Bijan Zangeneh has said the Joint Ministerial Monitoring Committee (JMMC) is not legally competent to make decisions about adjustment of production quotas. Sanctions,

AlreadyKasra Nouri Dud Policy Director General of Public Relations

n spite of efforts made by impose sanctions on Iran’s oil sector. Such industrialized nations to master sanctions were already imposed on Iran Isophisticated technologies with a by former US administrations, proving view to developing and fostering non- to be futile. Despite threats and illogical fossil energies, oil still remains the most measures taken by the US government dominant energy carrier in the world. in imposing unilateral sanctions on Oil is unlikely to be supplanted by any Iran, the oil market is not in position to sustainable alternative at least for remove supply from Iran which remains decades. That explains why oil market the world’s largest holder of hydrocarbon has experienced ups and downs over the reserves. past century. The oil market is affected Driving Iran out of oil market would by the slightest global and even regional require an extra capacity of 2.7 mb/d, developments. The establishment of the which is currently impossible even by Organization of the Petroleum Exporting OPEC and non-OPEC producers together. Countries (OPEC) was among the first The second obstacle in the way of steps taken aimed at supply management imposition of unilateral sanctions is the and adjusting supply and demand in the psychological impact of energy market market. Maintaining market stability and that may experience a new price shock. security for energy carriers, particularly That is not acceptable even to the US’s oil, takes up added significance when traditional allies. Oil price volatility one takes into consideration the fact that would hinder development plans in oil non-OPEC oil producers and even oil producing nations which heavily depend consumers are in continued interaction on petrodollars. However, developing with OPEC in a bid to push ahead with nations are also facing budgetary shortfall, their industrial, economic and social which would result in depression and development plans without hitting any social consequences. No country would snags. A prime example of such OPEC/ be ready to accept such conditions just non-OPEC cooperation was the recently to appease Donald Trump. Trump has so held 10th Joint Ministerial Monitoring far triggered political and trade war with Committee (JMMC). The meeting such countries as Canada, Mexico, China underlined the need for the participating and Russia after making hasty decisions countries to conform to their quota and pursuing adventurist policies. Now obligations. Under such circumstances, he seems to have no rational analysis of the Trump administration is seeking to re- realities on the ground in the oil market. Ministry of Petroleum Islamic 26 44 Republic of Iran NIOC Eyes More Export Terminals Managing Editor: Kasra Nouri South Pars to Export Products via Tombak Director General of Public Relations

Editor in chief: Parastoo Younchi

Executive Editor: Hamid-Reza Shakeri-Rad

Graphic Designer: Saman Goodarzi

Photo Section, PR Office, MOP: 30 Hassan Hosseini

Reporter: Negar Sadeqi Javad Asghari

Translator: Kianoush Amiri

Coordinator: Abbas Lotfi

Tel/Fax: (+98 21) 61626113 www.iranpetroleum.ir [email protected] Paulo Sérgio Bento 15 Petchem The JMMC Iran to Brito: Ilam, Established by Beauty of Projects OPEC-non-OPEC; Build Oil COVER I’m Enjoying Online Not a Decision- Storage Tanks Iranian Zagros in 5 Years Making Body Football, in Jask Port Culture and Food 4 56 58 32 22 Interview September 2018 Issue No. 75 monthly Interview

Iran’s Minister of Petroleum Bijan Zangeneh has said the Joint Ministerial Monitoring Committee (JMMC) is not The JMMC Established legally competent to make decisions about adjustment of by OPEC-non-OPEC; production quotas.

at all, apart from Russia and to some extent Mexico. members or small members, all the members are Russia has helped a while and the point is that equally participating in the Organization’s activities they’re not our problem in this situation right now, and every member’s views should be taken into they helped and then that period will expire, and consideration. And my main issue is that, the JMMC they can cooperate as much as they want based on meetings is given the mandate to monitor market aNot Decision their own interests as a country that is a non-OPEC and report .As you may recall I was head of the producer. But expectations from the OPEC countries OPEC’s Ministerial Monitoring Subcommittee(MMSC) is higher, particularly in the current situation — and for eight years at one time ,and the body never had Maker I’ve previously mentioned this many times — it’s not all this fuss and noise before. Even though, some Bijan In an interview with appropriate that two OPEC members start leading non-OPEC countries participate in it, it doesn’t make and taking on the leadership of an anti-Iranian much of a difference anyway. there are S&P Global Platts and Bloomberg Zangeneh some countries movement. News in Tehran, he said that “all You positively talk about Russia. But which want to decisions will be adopted only in the Do you mean UAE and Saudi? apparently, Russia and Saudi Arabia are together… dismantle OPEC two OPEC OPEC oil and energy ministers’ meeting I’m not mentioning any names at all. But the two I said before. Some countries have complicated and they want members in the presence of all member countries OPEC members are taking the helm of global anti- political objectives expressed in simple, economic to make this Iran campaign in the oil market, this is completely are taking thing [JMMC] and based on consensus.” The interview was obvious and it’s not right. It’s not either right as say ‘we will sort it out [oil shortage in market],’ any the helm of much bigger carried out ahead of September 23 JMMC neighbors or as partners. They take on this anti- wiseterms, person while saysthey ‘that’sare not right, economic demand at all. and When supply they global anti- than it is meeting in Algeria. Iranian tide and then they also take onboard should be balanced naturally. But if you look at it Iran campaign cooperation with America in order to hurt Iran, and a bit closely, it is not an economic argument. It is in the oil Will you attend the JMMC meeting next with the US and fear of the US NOPEC bill. They then they pull some non-OPEC members along with indeed a signal to the US: put as much as pressure market, this week? them who don’t necessarily understand the depth of you want on Iran, and we won’t let the market face is completely I’m not going (to the meeting). Mr. Kazempour destroying OPEC without directly saying so, they want the political complexity and the other aspects that any problem. This is what we should get. This is a obvious are sacrificing OPEC, they are slowly and gradually Ardebili, will head the Iranian delegation in Algeria. to gather some names together to create some sort I don’t want to explain here. For instance they will political message. I don’t believe that Russia wants and it’s not But Iran’s position in terms of the current agreement say something like ‘we won’t let there be a shortage to cooperate with the US and blow a strike to us, but right. It’s not will be made in the ordinary meeting of the OPEC idea that you should commit suicide for fear of death; in the market’, which on the surface is a very good some others do. Conference. soof “Forum”we’ll carry to onreplace what OPEC. we’re Wedoing. never In the believe nearly in 60the idea to say or is economic. But in my opinion such a either right as year life of OPEC this sort of thing has happened statement has nothing to do with economics and is What’s the JMMC’s role in pursuing the US neighbors or What are the positions of Iran in the 10 times or more, and there will be more ups and 100 percent political and against Iran. Anyone who will? as partners Sunday meeting in Algeria? says they will compensate for the shortage in the It is not to make a decision or determine or in my view OPEC is one of the third world’s biggest market is speaking against Iran. And it’s a political distribute quotas… a group here has made up decision-making mandate. The JMMC doesn’t have accomplishments,downs. You mustn’t not just just sacrifice in terms OPEC of oil out producers, of fear — statement; I do not see this as economical. There something against Iran and assume that they can We believe that this meeting doesn’t have any but it’s an organization that can impact the world’s are not any economic principles in it. And contrary succeed. These are bad intentions. I announce here decisions, not on any issue. Its observations aren’t economy and it has a good, strong foundation. And to what they say, they’re actually involving not only that what they do is not appropriate,” determiningthe authority either. nor is Itit onlylegally observes qualified and to monitorsreach and so there are some countries which want to dismantle OPEC but also non-OPEC countries in a political it just watches, observes and reports to the meeting OPEC and they want to make this thing [JMMC] much game. But as this political game is one that is working Have you talked with other OPEC members exclusively for the ministers present in the meeting. bigger than it is, out of proportion, pointlessly. If you in tandem with the US policies, some people don’t and Russia to help reverse these moves that are The JMMC has no right to make any other decisions. pay attention you’ll see they are making this OPEC/ want to talk about it. Now, some OPEC and non- in line with the US objectives? I’m going to say something now in general about non-OPEC meeting into a big deal while it’s not OPEC countries are working in line with moving I don’t say that Russia is acting in line with the US OPEC, there is something called the Declaration of that important. This entire story around OPEC and along the approach of the US. Unfortunately, a part objectives. Russia is big enough not to do so. But Cooperation (DoC), we celebrate it and appreciate non-OPEC was about cutting 500 thousand barrels. of the Secretariat is also moving in this direction some might take advantage of Russia’s cooperation. it a great deal. The non-OPEC members that have The rest of the countries haven’t cut anything. In fact, and we have realized this. And I want to notify the I have contacted some of the ministers, talked to joined us in the past two years, especially Mexico and they didn’t have production capacity. Look at those Secretariat hereby to be careful about its work, a them, wrote letters and explained to them, recently, Russia, have worked with us and have really helped part of its works, and remind them that OPEC is and have drawn their attention to this issue. us stabilize the market very much. But, the DoC is not that they’ve cooperated politically and sympathized an independent organization, it is not a subsidiary supposed to replace OPEC. withcountries us, but which they cooperated all produced with under us. theirWe are quotas thankful and of the Department of Energy of the United States, Have you only talked to OPEC members? My analysis now is that OPEC is the victim of a that’s why conformity of some of them reached nearly No, I have also talked with non-OPEC, too. creeping movement that’s a result of both cooperating 200 percent and 180 percent. They couldn’t produce and its officials must pay attention to this. What 4 matters is the members’ will. We don’t have big We have heard that you have written some letters 5 Interview September 2018 Issue No. 75 monthly Interview

to the OPEC Secretary General about some members an organization, from which the third world has production capacity. But eventually, it won’t last long. All my time and efforts and those of my colleagues not abiding by the agreement. Yes, they are violating No international analysis says that missing Iran’s oil are being focused right now on this economic war and they want to bring OPEC on board and pursue can be tolerated in the long run. that America has launched against us. their illegitimate goals. They are both overproducing benefitted so far. It can still play a role, but the world and insinuating a wrong understanding from the fromchanges, power, and not there reasoning. are developments. This is very We important… shouldn’t Iraq is increasing its output… Do you think the way that OPEC members, OPEC agreement. If they want to produce more, forgetOPEC onehas principleups and downs. which isOPEC power. basically Influence makes comes No, it can’t. Iraq hasn’t increased its production. Saudi and Iraq do in terms of production we cannot stop them, because there is no forcible It is a long time that its production has stayed increase; do you agree that they are using OPEC instrument in OPEC. But they shouldn’t do it in the and the market is demanding, everybody does as a political tool? name of OPEC. They should announce ‘the US has whatsense it when wants. it cutsOPEC output. is meaningful When prices when are it wants high to I said that some OPEC members, I haven’t phoned and told us to increase our output, and there cut production in order to raise prices. There, it is andfixed. destinations. There is a reason. I won’t I saydon’t a wordtalk about because the mentioned any names. I’ve said some OPEC Bijan is no other way but to do so.’ Today, some of these Americansproduction, have neither assigned about resources, its figure, thecivil exports, forces, members, contrary to everything that they’ve said countries tell us ‘oh we cannot take much more oil digging OPEC’s grave with our own hands. not military ones, in many ports and countries and themselves and contrary to their own motto against Zangeneh influential, I mean if we are not careful, we will be they are controlling, watching and carrying out politicizing OPEC, are actually politicizing the Bijan relation with US and we can’t ignore what it wants.’ Haven’t the ministers to whom you wrote an intelligent monitoring. They watch our people. entire organization in order to materialize the will from you [Iran]. Please understand us. We have long responded yet? I don’t want to give them additional information; of the U.S. And they are paving the way for the US. some OPEC Zangeneh say it’s what OPEC said [decided]. They should say No, but they have received the letters. I don’t want to brag today for them, neither do I members, it’sOk! their We don’t own wantdecision to fight because with theyeach can, other. it isBut what don’t want to explain my countermeasures. I don’t want market’ what they mean is, ‘come on Mr. America, contrary to it is, take it or leave it. They should say ‘we increase Do you think Saudi Arabia and Russia to say how much we produce. These all would help imposeWhen they sanctions say ‘we on have Iran no as problem much as in you securing want and the everything that We the production because we can and we don’t pay can produce more than the amount they have them to obtain free information. I am not going to destroy the people of Iran and it’s not a problem, established an they’ve said attention to anyone, and they should also say we can’t poured into the market so far? give them that. The oil industry is working with we are with you’. Politically, this is what it means. themselves organization, resist the US instructions. But don’t put it on OPEC, Some countries are relying on their inventories. It means cooperation with the US in sanctioning and contrary from which and I think that is why they are destroying OPEC. They give some numbers for their inventories but I eventually. Iran. Anyone who says this is cooperating with the third world don’t know if it is true or not. I don’t know whether full force. I won’t give information. We will see to their own motto against has benefitted Are you worried about OPEC as a founder or not the volume of inventories that Saudi Arabia Do you want a permanent seat on the will make-up for any shortfall in oil’ is so far. It can member? says it has outside the country and elsewhere are JMMC? the US. Whoevergoing says this,along whoever with the at Americans all, says ‘we politicizing still play a Yes, we are worried about OPEC but much more real. But from now on, I think, they will rely on their No, whereas it is just observing and and is giving a greenlight to the OPEC, are role, but the worried about Iran itself. I support that organization inventories rather than their production to pour monitoring, indeed it only monitors the Americans to sanction Iran, to actually oil into the market. I think they don’t have excess situation; there is no reason to need that. exacerbate Iran and to deepen world changes, politicizing the entire and there are for Iran, not the other way around. We established developments Exclusive Question organization in order to Such a decision is illegal. The JMMC has Do you confirm 35% down exports since April? You will veto any decision that materialize the no decision-making mandate. I will say comes to OPEC? this, that in general the JMMC has no right I said that any decision that poses even will of the U.S. I don’tWhat give aboutany figures. tankers and shipment, buyers? to make decisions. Any decisions made the smallest danger to our national interest, And they are by JMMC are invalid. It can only observe without any hesitation at all, I would stand in paving the way take advantage of it against us. It is like ‘anything you say and report. Decisions can only be made its way. I’m there for my own national interest for the US mayI don’t be giveused any against information. you in a courtWhatever of law,” I say, he the said US with will at OPEC meetings in the presence of all alongside everyone else, and this is true for a smile. I won’t reveal what customer, what destination, OPEC members and through consensus of everybody. what countries, with which tanker I ship oil, how I solve members. The place for decisions is at OPEC. my insurance problem, I won’t give any information, and This body [JMMC] is monitoring only. All this What are your views on this current you can write that down. fuss, advertising, promotion and placards- agreement and its continuation? this is just to propagate for pulling OPEC The agreement doesn’t really exist anymore. It’s Can you say who the buyers are? apart. work in favor of the U.S., I won’t talk about it. They If the JMMC enters the ministers meeting thereforefinished. Russia it’s over. came There’s long, no cut agreement 300 thousand left willNo. useLook, whatever if America I say finds against out anythingus. I’m not that going could at OPEC...? really.barrels I talkand tothen OPEC. got thatI don’t 300 have thousand much to back, to release the name of customers and shipping say to non-OPEC.I am addressing OPEC. I companies. I’m not going to disclose how we respect their [non-OPEC] cooperation in the send our cargoes or how we solve our insurance threatensWell, ok. Without our national a moment interests. of hesitation, Vetoing means I will future, but it doesn’t need all this propagated problems. I’m not going to talk about these points, thatdefinitely the decision and definitely isn’t legal, veto it’s any illegal decision if there’s that a meetings, logistics and spending. because they work to their advantage. veto. So in December if they want to If the forthcoming JMMC meeting reaches a So, right now you won’t be at Algiers, if renew/continue this agreement, decision that’s beyond the authorized proposal, they make a decision. what will your position be? does OPEC have an approach on what to do? They can’t. The Algeria meeting is not an OPEC It’s void. It’s invalid, it’s a void decision. Conference. We’ll discuss it then. 6 7 Interview September 2018 Issue No. 75 monthly Interview

sanctions against Iran. or production level, after the problem is resolved, regardless of any decision, without the need for any Have there been any new agreements with approval at all, I will resume my original production Russia? There are always new agreements. will return to my prior production level. I’ve told this totrend. OPEC Without MCs and the I’ve need said for it obtainingrepeatedly. any approval I Are the agreements in relation with oil exports or anything? How do today’s sanctions and situation On exports, as I mentioned, I won’t provide any differ from the situation in 2011? more information. then. This is just the bullying of the US, at that time it So, there are new agreements or they are wasWell, multilateral, that one was international UN Security sanctions. Council sanctions Right now, in the process of being made, or they’ve been no country apart from Zionist Regime and two other signed? countries in the region — two of our Arab brothers — no one else is with the US. subject to all the international laws and regulations. The Americans are trying really hard to prevent Now this is just America that is throwing its weight prices from going up until November. But if you take Bijan Now,In the the trend time is thatgood. there’s We’ve beenmoved this forward. But they are cooperating ... around, it’s holding up a sword and calling for a look, the trend for prices right now is upwards and agreement, has share of any OPEC MCs gone to No, it is not Cooperation… if someone is bullying challenge over everyone. And now, we’ll do our best they bring prices down with an intervention. But if Zangeneh non-OPEC countries? and holding a sword, it is a different story ... but they leave it alone, the price trend is to rise and to Bijan Look, OPEC won’t give any share of anything to these sanctions are not legal and it’s not like keep rising. and God Willing, God will help us if we are honest. anyone. The Persian Gulf countries won’t leave everyone is afraid of the UN and contravening some Rick Perry, Al-Falih and Novak met recently, The US Zangeneh a single barrel of their market share to anyone, laws. do you think this was just promotional/ What’s a suitable price for oil right now? doesn’t want unless they cannot produce. Even what they Right now, from one perspective it’s harder and propaganda or how much was it about affecting Right now, a suitable price is $80. Now, the higher WTI to go cannot produce, that they won’t give that up either. from another perspective it’s simpler. It’s harder it gets the better it is for us. But it won’t. The US and production? up, if it goes OPEC won’t Practically they don’t have it in hand, maybe they’ll from this point of view that the US has all the No, I think this is all mostly propaganda. The some OPEC members are not allowing it through up Trump give any share tell the other side, we [give it] to you, but they experience of the previous round, and it’s already Americans routinely go to different places, following, their meddling. of anything to haven’t been able to use it themselves. If there’s worked out some of our methods/workarounds threatening, they go here and there and doing won’t get the votes… They’re anyone. The food that they can’t eat, maybe they’ll donate it and therefore we have to use more complicated, whatever is that they do and we know about what Some sources have said that Saudis want Persian Gulf somewhere. But they won’t even let one barrel go. new methods and the US is a lot more persistent, they do. Any company that contacts us, they contact high prices, i.e. above $80. putting all countries won’t especially given the US have made up its mind to them half an hour later, they talk to them, and they their efforts cut out production to a great extent in November routinely monitor and eavesdrop and follow and up, if it goes up Trump won’t get the votes… They’re leave a single If you accept that Iran’s oil production into WTI not will drop or its exports will drop, will we have even if in a symbolic way. In my opinion this is very keep an eye on our managers. They are clearly No, not right now. The US doesn’t want WTI to go barrel of their going up. He negotiations with OPEC MCs beforehand like symbolic for them. following everything. brought it under $60 and now it’s going up. As soon brought it market share to putting all their efforts into WTI not going up. He what we did in 2013 and 2014 for the return of And we are doing our best, making all efforts, but as it goes up, they throw in some from inventories, under $60 and anyone, unless I don’t want to say how much and to what extent from here and there and they won’t ever tell the Iran’s barrels to the market? What’s your analysis of the current market now it’s going they cannot we’ve been successful, because he (the US/Trump) conditions and in the months ahead, considering truth about what they’re doing. But the DOE report up produce than exports only production is part of the OPEC’s winter is ahead, what does the market need? on production said that the market cannot sustain criteria.No, I’ve Andalready in my written previous to them communications that, firstly rather I UN sanctions are very heavy in terms of the law, Some more barrels? Iran’s absence from the market. It cannot tolerate have mentioned, if anything happens to my exports meaningwill find out. that That anyone [previous] who violated round the was sanctions UN-related; was You need to understand from price change trends. Iran’s removal from the market. Exclusive Question

Do you think that if production really Now Trump could do so and it would be good It’s underway. It’s coming on trucks and it is Would the US be able to reduce Iran’s oil drops heavily, how much will the price for him to suspend the sanctions. being received. exports to zero or it’s just a bluff? of oil go up; let’s say in the worst case In Vienna I remember you saying in Do you want to increase it? I think that Mr. Trump has made such scenario? terms of Russia’s oil supply, we’re neither Yes, we would like to and we are after decision without consulting experts even The higher the better. permanent friends nor enemies [in terms of increasing it. within the US administration to reduce Iran’s What needs to happen for these oil issues] — is that still your view? And in terms of selling oil to Russia, are oil exports to zero and he insists obstinately sanctions ... what has to happen, does Mr. It’s always my view. It’s not about being friends, you seeking more than the current level [100 on implementing his decision. But he recently Trump have to go? What will and needs to brothers or enemies. thousand barrels]? realized that such decision is impossible and happen in your opinion, what And Russia, what’s your view on the fact therefore he is seeking to reduce Iran’s oil exports to zero, albeit symbolically, for one can Iran do? Iran has to do that it says on the one hand it’s against the Is Iran using discounts more now, as a something. sanctions but then on the other hand it will We are keen to provide more oil to everyone. month. Therefore, Mr. Trump is seriously tool? trying his best to reduce Iran’s oil exports Right now, I don’t want to enter these secure oil supplies? No, it’s not really that important. discussions. Ask them, you need to ask them. to zero. Of course, this is just one side of the So what is Iran’s position on the current coin as we have not our hands and feet tied. Well something has to be done; Iran Can you update us on the Iraq-Iran swap agreement, will you support it? In addition to doing our best, we believe that can’t just keep going till it hits a dead end? situation? divine hands are at work. 8 We’ll see at the time. 9 news September 2018 Issue No. 75 monthly news The deputy CEO of National existing restrictions, there circumstances different from in the materialization of is to preserve cohesion and No Halt Iranian Oil Company (NIOC) will be no question of halt [in the present ones,” he added. objectives,” he added. Noting integration of activities with production],” he said. “NIOC Manouchehri said most oil that the projects would face no a view to pushing ahead in Iran Oil plan to proceed with lifting is determined to forcefully production projects, numbering with affairs and preventing oilhas production. announced Iran’sGholam-Reza firm preserve its production ceiling Iranian or foreign currencies, any waste of assets,” he said. Supply Manouchehri said the oil and we hope that once oil National Iranian South Oil hefinancing said that problems necessary either permits in “This issue must be taken into production enhancement plan recovery enhancement and Company34, would (NISOC).be operated by had been issued for issuing consideration by both clients was aimed at job creation and preservation projects come “Under relative stagnation, and contractors by doing business prosperity for Iranian online, leading to further oil implementation of so many is important in maintaining their utmost to implement the companies. “Therefore, despite production, we would see projects would be instrumental andbonds raising in Iranian oil production rials. “What project on schedule.”

Putin Lays Blame on Iran Company Shortlisted NIDC, PUT Sign UK Eager for Energy Ties Trump for Oil Price Hike for EI Awards Training Agreement with Iran Russian President Vladimir Putin said his Iran’s South Zagros Oil and Gas Production National Iranian Drilling Company (NIDC) British Prime Minister Theresa May has American counterpart is to be blamed for Company (SZOGPC) is on the shortlist to and Petroleum University of Technology expressed the readiness of her country for current high oil prices. “President Trump receive Energy Institute Awards 2018. (PUT) have signed two agreements for cooperation with Iran in the energy sector. considers that the price is high; he’s partly The philosophy behind this selection is cooperation in training, research and May said in a meeting with Iranian President right, but let’s be honest,” Putin said at the consulting. During the signing ceremony, broaden economic cooperation with Iran. They implementing flare gas reduction system development of human resources and Hassan Rouhani that Britain was willing to riseRussian in prices, Energy you Week need conferenceto look in the in mirror.” Moscow. (FGRS) in Farashband Gas Refinery in expansionthe significant of cooperation role of education between in thethe two annual gathering of the United Nations General The“Donald, Russian if you leader want pushed to find back the culprit against for the southern Iran. Gholam-Hossein Montazeri, bodies was stressed. Assemblywere meeting in New on theYork. sidelines May also of thestressed 73rd the escalating criticism of OPEC and its allies, MinistryCEO of SZOGPC, was on saidthe EI it wasAwards the shortlist.first time a Younes Bani-Saeed, director of human which Trump has blamed for Brent crude’s company affiliated with the Iranian Petroleum resources at NIDC, said the agreements were deal with six world powers, known as the rise to a four-year high near $85 a barrel. Still, aimed at holding short-term, mid-term and Jointsignificance Comprehensive of salvaging Plan Iran’s of Action 2015 (JCPOA), nuclear Putin said his country has already boosted He said that the FGRS project would prevent long-term training courses and training following the US withdrawal. Rouhani said the output and has the capacity to add another the flaring of 2.1 mcm/month of gas. “This US “illegal” withdrawal from the JCPOA drew environmentalproject was designed pollution to reduce and return gas flare gas toat surprise and opposition from the international Putin’s comments come after Trump criticized the Farashband refinery. It would help reduce workshops based on the scientific and Russia200,000 and to OPEC300,000 for barrels a 2016 todeal the in market. which they years.technical qualifications and human resources. cooperation and continue negotiations in a agreed to curb oil output in a bid to support millionthe refinery a year. fuel The cycle,” EI Awards he said. event Montazeri this year TheAli Seyyedipour,agreements are director expected of physical to run for assets five bidcommunity. to reach “Wea suitable have topractical try our frameworkbest and increase for issaid scheduled the project for wouldNovember save 22Iran at aboutthe Sheraton $3.4 at NIDC, said the agreements would help safeguarding and implementing this agreement, glut in global supply. develop physical assets. particularly in the economic sector,” he said. prices that had slumped in mid-2014 due to a Grand Park Lane Hotel, London.

wants to remove Iran’s oil from the market and on the other Iran Oil Production to Continue Unabated hand he wants low prices,” Iran’s petroleum minister, on China and European nations faced no oil shortages “and he said. Zangeneh added that are leading oil consumers. therefore there is no need for the country’s readiness to “Iran and the Organization production hike”. mboe/d of oil, petroleum Bijan Zangeneh, has reaffirmed keep producing oil. “The US is of the Petroleum Exporting The Iranian minister said productsthat the removal and petrochemicals of Iran’s 4 doing its utmost to prevent us Countries (OPEC) have no oil prices had exceeded $85 “is not an issue to be tolerated from producing oil for market responsibility in this regard. a barrel, adding: “Mr. Trump easily by the world, and prices supply, but Iran will forcefully Rather, Iran intends to produce has announced OPEC is will keep rising.” “Oil prices keep producing crude oil,” he oil at full capacity, but the US is responsible for oil price hikes have already increased while said. making every effort to prevent and it must boost output, but OPEC has not cut its output. “The best action for oil prices us from producing our oil,” he we have to say that OPEC is Therefore, the issue of price not to increase and remove added. not responsible, rather [US hike is psychological and now tensions from the market, Zangeneh said the Joint President] Donald Trump in they expect OPEC to boost its would be the US lifting Ministerial Monitoring person is responsible for oil output,” he said. OPEC is no sanctions on Iran,” he added. Committee (JMMC) of OPEC price hikes.” longer able to boost its output, Zangeneh said any decline in and non-OPEC producers in “The oil market is facing no to psychological issues and Americans,” said Zangeneh. he said, adding: ‘”OPEC is oil production and subsequent its recent meeting in Algiers shortages now. Global oil “Trump’s motives are producing at full capacity and concluded that the market prices have increased due insinuated into market by the doubled. On one hand, he has no surplus capacity. political tensions artificially 10 price hike would inflict losses 11 news September 2018 Issue No. 75 monthly news Bandar Abbas Oil Petchem Plants Refinery to Lift Gasoil Output Hits 27mt Output Iran’s petrochemical plants have brought Iran Able to Boost Gas their combined production to about 27.5 NDC, RIPI Eye Export Capacity southern Iran is set to increase its million tonnes, director of production Cooperation The CEO of National Iranian Gas Company premiumThe Bandar gasoil Abbas production oil refinery after in a new control at the National Petrochemical North Drilling Company (NDC) and Research (NIGC) has said the country is able to supply section as added to the treatment facility, Company said. Qodratollah Farajpour said Institute of Petroleum Industry (RIPI) have agreed more gas to foreign buyers. this level of output was reached while to cooperate further in the energy sector, NDC “Iran enjoys necessary capacity and potential to “The gasoil dehydrogenation unit at the many petrochemical plants were being chief said. expand its gas exports to neighboring countries the CEO of the refinery said. overhauled. “Although a large number of “Joint cooperation between RIPI and NDC is to with a capacity of 50,000 b/d, which is petrochemical units with a high output increase in upstream, downstream, energy and international energy conference in Moscow. Bandar Abbas refinery is coming online were being overhauled and had halted and other buyers,” Hamid Reza Araqi said at an Namvar said. “Once this section has come production, we witnessed such increase,” CEO of NDC, said. online,the largest premium unit at gasoil the refinery,” production Hashem at the he said. environment sectors,” Hamid-Reza Golpayegani, “MostHe said energy that energy consumption consumption is in the in powerthe world plants is the upstream sector, particularly in drilling and andset to industries keep growing and gas by will2030. make up the main the methanol, urea and ammonia unit of He said that RIPI had taken effective measures in source of energy in coming years,” added Araqi. wouldrefinery reduce will reach the sulfur 15 ml/d.” content of gasoil ShirazHe said Petrochemical that Maroun PetrochemicalPlant, Fanavaran Plant, “The achievements and results of RIPI show that “In light of environmental issues, gas fromHe said 10,000 that ppmthe dehydrogenation to below 50 ppm section while methanol plant, Kharg Petrochemical thedrilling managers fluid. and researchers at the research consumption will follow an upward trend by Plant and Zagros 2nd methanol, as well as Arya Sasol Petrochemical Plant and Pars sanctions and managed to create many golden “Iran is among major producers of gas in the standards.the quality of gasoil at the refinery would Petrochemical Plant were put to overhaul. opportunities.institute have benefited That will fromreduce conditions drilling costs of and world2030,” andhe said. in the near future most of Iran’s be“The upgraded isomerization to comply unit with is also Euro-4 close to “In spite of these widespread changes neighbors will use Iran’s gas. That requires us coming online,” said Namvar. Golpayegani stressed the need for the use of to prepare the ground for such conditions,” he domesticallyboost efficacy,” manufactured he said. products, adding: andin the we first have half so offar the managed [calendar] to meet year, “Contractors need the permission of clients for country now owns the largest volume of gas progress, He said that adding the thatsulfur it wouldrecovery come unit is figures and statistical data are promising using domestic products. Therefore, certain reservesadded. “With in the infrastructure world. Therefore, created we incan Iran, say the that onlineunder constructionby next March. with 63% physical is acceptable,” he said. Farajpour said regulations are needed for companies like NDC, a good future is awaiting Iran’s gas industry,” said The Bandar Abbas oil refinery plans to Iran’snearly petrochemical 80% of nominal output capacity, reached which a contractor, to be able to use domestically upgrade the quality of its gasoline and to take maximum advantage of this God-given other refined petroleum products in a success in developing light cements and drilling endowment,”Araqi. “We have the to NIGC focus chief on gas said. exports in order bid to help protect the environment. year.27.5 million“Since in tonnes the second in the halffirst of half the of year, the manufactured materials.” He highlighted RIPI’s Under current plans, the quality of wecurrent have calendar had less year,overhaul up 2% and year-on- we expect a lot on such materials, but if institutes like RIPI villages are connected to gas network, and most gasoline will reach Euro-5 standards our production level to get closer to the fluids,master adding: the production “Domestic of companies such materials have for spent industrialHe said that and all petrochemical Iranian cities facilitiesand 95% are of Iranianfed while gasoil would comply with nominal capacity in the second half industrial purposes, we will save millions of with gas. dollars in hard currency.” Euro-4 standards. than in the first half,” he added.

Stop Sanctions on Iran to Fix Prices thattwo OPECOPEC’s officials August to output respond was Iran’s governor for OPEC said and insulting governments and to increase their production 870,000firmly to b/dthe UShigher insults. month-on- He said that US sanctions on Iranian in order to help reduce oil month. “During this period, oil were “not feasible”. “Mr. any assistance and cooperation prices. Such expectation is decline in production by some Trump is very angry with innations,” favor of he the said. reimposition He added that of unfounded and baseless,” he some countries for not being US sanctions against Iran would added. “OPEC members have able to replace the Iranian be “hostile”. “In case Iran is no role in the oil pricing and oil OPECmembers oil producers totaled 468,000 increased b/d,” oil, and has expressed this sanctioned, oil prices will go up. prices are determined based he added. He said that non- anger in his remarks to the Then, Russia and Saudi Arabia on the market fundamentals in August from the month Saudi king and to OPEC for not could do nothing for supplying (supply and demand),” said before,their production while production 273,000 loss b/d extra oil on the market,” he said. Kazempour Ardebili said. Kazempour Ardebili said the US regretted the silence of OPEC increasing output,” Hossein is providing military support to secretaryKazempour general Ardebili. and He rotating saidamong that them Saudi was Arabia 293,000 and US president of the fact that two OPEC members while it has president vis-à-vis President Russiab/d in thehad same increased period. their He oil production in comparison there“We had is no earlier adequate reminded capacity the imposed sanctions on two other Trump’s affront to the to their commitments in the output rise, and this production to replace Iran’s oil in global OPEC member states. “Under Organization of the Petroleum Declaration of Cooperation, risea 346,000 is a violation and 250,000 to the b/d(OPEC) markets. Therefore, he has to such circumstances, the US Exporting Countries, saying theirproduction May output. 415,000 “If b/dwe look and we see Saudi Arabia and agreement on output cut,” stop sanctioning, affronting expects other OPEC members OPEC members expect the at235,000 the two b/d countries’ compared rise with of Russia have had respectively Kazempour Ardebili said. 12 13 September 2018 Issue No. 75 monthly Iran Plast Waste Tire Recycling Tahereh Soleymani, director of commerce at Gowhar Farayand Khalij Fars Co., said carbon black Iran Polymer had been retained from the recycling of waste tires as part of efforts to protect the environment. “This company was established in 2012 and has since been producing carbon black from recycling waste Highly Attractive tires. The products are processed before being supplied on the market,” he said. “This product is used in such industries as textile, polymers, The growth of polymer and plastic industry in Iran has helped domestic granules, PVC items, rubber composite, paints and manufacturers find more destinations for their products under any circumstances. Iranian producers present at Iran Plast this year believed that the high quality of Iranian-made products, coupled with affordable prices, had artificial leather,” he added. pushed small-sized companies to consider expanding cooperation with Iran. There is a globally growing demand for petrochemical industry products. This industry has penetrated every segments of human life to the extent that it may not be easily eliminated from industries and households. Sitting atop the world’s largest hydrocarbon reserves, Iran has over recent years done its utmost to develop its downstream petrochemical industry in order to complete its value chain and prevent the sales of crude oil. To that end, a variety of petrochemical products have come online in order to supply necessary raw materials at affordable prices to downstream petrochemical industries.Iran’s polymer and plastic industry is enjoying a special position Machinery Makers in the Middle East and Iranian companies are developing their export markets despite all Happy with Iran problems created due to US sanctions already reimposed and more sanctions Washington Plast plans to snap back into place against Iran’s petroleum industry. This year’s “Iran Plast” was Machinery manufacturing industry is marked by negotiations between Iranian companies and foreign visitors. among industries directly linked with downstream petrochemical sector. Ali Shamloo, secretary of Union of Machinery Iran Standing in Manufacturing and Polymer Equipment Mideast Producers, said orders had been placed 70% Exports with machinery manufacturing booths in exports at Persian Gulf Petrochemical Oveis Afzali, director of research and development this year’s Iran Plast. “Most members of IndustriesHossein Pir-Rasoulzadeh, Company (PGPIC), director told Iran of at Sirjan Granule Plant, said the company’s products, the Union managed to sell machinery. That mainly compounds, PE100 and P80, attracted visitors Knowledge-Based Companies is why they are happy with the exhibition,” consumer and a big manufacturer. at Iran Plast this year, as was the case in previous Products support was needed for improving the Petroleum:That is why “We we are have both a very a leading big Knowledge-based companies were among exhibitors of "Iran Plast". All exhibition with domestic and foreign visitors, he businesshe said.He environment said that in government the machinery domestic market as well as solid-based of them were taking part in the exhibition with new products. Visitors had years.Highlighting negotiations held throughout the manufacturing industry. “Technologically downstream industries.” “That is why expressed willingness to cooperate with them. Some of them expressed were from East European countries and neighboring speaking, we are in good conditions and raw materials and petrochemical hope to be able to strike contracts for the marketing of their products after said: “Hopefully we had good talks with visitors who we are making progress. Conditions products are transformed into products the exhibition concludes. Mehdi Shabankareh, CEO of knowledge-based of higher value-added, giving Iran a our products are exported to Central Asian nations, have improved with the emergence of unique standing in the Middle East,” nations,Persian for Gulf selling states, our Turkey products.” and “More some Europeanthan 70% of knowledge-based companies,” he added. countries. I hope that problems related to currency Shamloo said machinery was being he said. “That is while other countries Nanowhite Paspar nanomasterbatch Fakour, said hisand company computabilizers had already were registered being produced 33 patents, for in the region, due to not having major exchange and high transportation costs would be some of which had no foreign prototypes. He said that some products like downstream industries, have no option capacity to move towards developing our had cut their price by three-fourths in Iran. “In the run-up to Iran Plast, we exported to 12 countries. “We have but to export everything they produce. the first time in Iran. Domestic manufacturing of such products, he said, markets.”Mohammad-Reza Shakeri, CEO halfsettled of the soon,” current said calendarAfzali. He year said (startedthat his company’sMarch 21). of Parsian Plastic Processing Machines But in Iran downstream industries have reach the stage of commercialization of some of our products,” he said. products were exported at a high rate in this first Referring to the high quality of polymer and plastic had started negotiations with petrochemical companies. We hope to soon Manufacturing Co., said 70 to 80 plastic products manufactured in Iran, Afzali said: “The processing machines were being exported market is much extended too,” said said Shabankareh. “Since the domestic market for petrochemical products relative advantage Iran enjoys in the energy sector to the United Arab Emirates (UAE), Iraq, grown significantly and the domestic “Thisis very year, extensive we unveiled we are 14 not knowledge-based worried with the products sales of ourfor theproducts first time,” and second largest company in the Middle is access to inexpensive feedstock, and the quality of Armenia, Tajikistan, Turkmenistan and Pir-Rasoulzadeh.East, adding it is Heamong said topPGPIC producers was the petrochemical products. That is why foreign buyers Afghanistan every year.“Owing to the high quality of our products we are able to ourthis focus year’s is exhibition mainly on to domestic receive fewersales. However,visitors, but foreign their companiesnumber has may so that negotiations were held between also use our products via their Iranian partners,” he added. “We expected compete in foreign markets and we can markets.have always Even been if after satisfied the enforcement with Iranian of products.” sanctions easily compete with Chinese and even ofPGPIC petrochemicals and foreign invisitors the world. at Iran He Plast. said foreign visitors were from India. Some of them offered cooperation for Afzali said: “We are looking for developing our export 14 “Compared with last year, visitors were far been beyond our expectation,” said Shabankareh. “More than 90% of European companies,” he said. 15 more specialized,” he added. developing our export markets.” conditions become difficult, we will not stop joint production in India. We are studying their proposals.” September 2018 Issue No. 75 monthly Iran Plast Iran, Good Partner for Foreigners Ali-Reza Dashti

t would be no exaggeration if we say that Iran is among top countries in the region in the plastic companies would behave to Iindustry. The growth of companies involved in this overcome restrictions slapped on Iran, she expressed sector and their efforts to win bigger shares of global hope that the German government and the EU would markets have led foreign companies to show interest close ranks in a bid to take effective steps for facilitating in cooperation with Iranians. At this year’s "Iran Plast", Turkish exhibitors at Iran Plast said the reason for the ties and serving public interests. The representative of what was marking was the foreign companies’ trust a German company present at the event said the main in Iranian companies for business and trade. They idea was to further know Iranian companies involved described Iranian companies as reliable and honest Iranparticipation and Turkey of Turkish would bring firms their resulted trade from exchanges increased to only reliable market and we prefer cooperating with partners, saying Iranian companies were supplying Iran-Turkey trade exchanges. He expressed hope that there were also foreign companies seeking non-oil highest quality plastic products all across the region. transactionsin raw materials and productionbusiness with and Iran. export. He noted that At "Iran Plast", the number of foreign companies was anthe interbanking highest level networkpossible betweenin coming the years. two Henations, said that "AmongIran." He obstacles also highlighted currently some in the problems way are causing the changing lower than last year, but Iran’s relative advantage in the tradingremoving in foreignthe Turkish exchange and Iranian rate fluctuations currencies creating and difficulties in the purchase of raw materials from Iran. Technology-Based Firms energy sector could not be ignored easily by foreign removing customs hurdles would help facilitate Iran- and subsequently unpredictable increase in the price of Italian trade commissioner in Tehran Augusto Di materials,"price of raw he materials, added. fluctuations in rapid succession Giacinto said most Italian companies present at "Iran plastic industry, in which Iran claims to be a front- imposing sanctions on Iran. Abbasev Aleskarovic, who Plast" were technology-based ones. Di Giacinto, who runner.companies. The Itpresence becomes of specifically 15 business important delegations in the from representedTurkey business. a Turkmen He insisted company that theat Iran US wasPlast, alone said in Reliable Partners for Germans had organized the participation of Italian exhibitors at broadening business ties with Iran would be of high investors indicate that involvement with Iran’s polymer plastic industry machinery and parts, were present at cutting edge technology with Iranian petrochemical and13 countries, plastic industry as well would as individual remain visits economical by foreign for with Iran had taken up added importance, he replied: A total of 17 German companies active in the field of industry"Iran Plast", in a said bid toItalian help firmsIran reach were itsready export to share objectives. their foreign companies. That comes against the backdrop “It’ssignificance. crystal clear. When Iranian asked plastic to explain industrialists why cooperation and the plastic and rubber sector of Germany's Mechanical of threats by US President Donald Trump to foreign Iran’s market are reliable for us. Iranian companies Engineeringthis year's "Iran Industry Plast". Association Ina Vettkötter, (VDMA), affiliated said with transactions and money transfer, we hope to be companies to stop doing business with Iran under are supplying high-quality products. That is why due German companies would remain highly willing to able"With to the facilitate removal ties of between obstacles the in twothe waycountries," of banking he the penalty of sanctions. Most foreign companies to Iran’s relative advantage in the energy sector, their cooperate with their Iranian partners. "The Germans said. Bhavin Vora, who heads the Indian exhibitors interviewed by "Iran Petroleum" touched on the high prices are appropriate for us.” have reliable partners in Iran," said Vettkötter, who quality of Iran’s plastic products. For them, Iranian was also chief coordinator of German exhibitors at representing producers, importers and consumers of companies are producing one of the best polymer and Iran, KRG First Choice "Iran Plast". "Owing to growing demand in the Iran plasticat the exhibition, and polymer said were nearly present 40 Indian at "Iran delegates Plast" this plastic products across the region. They noted that The chief delegate from the Kurdistan Regional market for plastic products, young and educated year. Referring to cooperation between Iranian and there were still mechanisms for sustainable cooperation Government (KRG) referred to the high quality of manpower have led the Germans to consider the Iran Indian companies, he said: "Iran's access to abundant Iranian plastic products, saying: "Iran is unique in market as burgeoning," she added. Vettkötter said hydrocarbon reserves has helped boost relations by the United States to drive Iran out of energy market. terms of manufacturing plastic industry products, that despite attempts made by the United States in between Iran and foreign firms despite attempts made particularly raw materials, across the region." The recent months to scare foreign investors away from cooperation for developing Chabahar Port was aimed at Interbanking Network a Must Kurdish industrialists receive raw materials for their Iran, the European Union continues to respect Iran's between Iran and India." He said that Iran-India The marketing manager of a Turkish company said he plastic products from Iran. According to them, Iran nuclear agreement with six world powers, known as June Joo, foreign trade director at South Korea's Smajin was happy with the level of cooperation with Iranian remains their top priority for raw materials they need the Joint Comprehensive Plan of Action (JCPOA). The US Polytech,deepening expressed trade ties hope between that thehis companytwo nations. would Hyung- be in their disposable vessels. Asked if they could also pulled out of the JCPOA in May. "Despite the US JCPOA plastic market, noting that he was interested in broader import raw materials from other countries, he said: withdrawal, the agreement remains alive and the EU 16 cooperationfirms. He said with a bright Iranian horizon companies. was awaiting The chief Iran’s of "Sure we can, but the Iran market has so far been our backs investment in Iran," she said. Asked how German andable weto shareneed totechnology maintain withour contacts Iranian firms.with the market 17 "We are well aware of potentialities in Iran's market September 2018 Issue No. 75 monthly Iran Plast Italy Favors Bonds with

taly’s trade commission inIran extruders Petchem and masterbatch in order to assist this country in Tehran Augusto Di Giacinto production lines, Dimontonate reaching its export objectives. Isaid his country was willing to cooperate with Iran’s petrochemical materials, IPM, manufacturer of manufacturer of petrochemicals industry despite US sanctions. “The upstreamFloccati, producer industrial of equipment, flocked whichHe said constituted Iran was a a major major share Italians are keen to cooperate with ITIB, producer of extrusion lines, Iran’s petrochemical industry,” Penta, designer and manufacturer have numerous options to continue he told "Iran Petroleum" at Iran of material displacement systems cooperationin the country’s with export Iran’s mix. oil, gas, “We and production automation, Piovan, involved in transportation IranPlast. Plast. He said Italy’s that trade nine agencyItalian howrefining developments and petrochemical would go industry. on,” (ICE),firms werethe Italian present Plastics at this and year’s and manufacturer of systems for heHowever, said.“Banking we have transactions to wait and see Rubber Processing Machinery and drippingtechnology, irrigation, Profile Dies, and Zambellodesigner are complicated due to pressure Molds Manufacturers' Association Group, which manufacturers from the United States. That is (AMAPLAST), Macplas magazine, gearbox for extruders used in the why the European Union has which covers plastics and rubber plastic industry. firmly supported the JCPOA industry, and Italy’s international (Iran’s 2015 nuclear deal with six exhibition for plastics and rubber Great Potential world powers) and is looking for industries (Plast), which is held Giacinto said the presence of solutions to facilitate transactions every three years, were among AMAPLAST and other Italian entities and money transfer, which we Italian coordinating bodies at at Iran Plast provided their belief in hope would reduce the negative the French government's Iran Plast. The Italian companies the potentialities of Iran’s market. impact of sanctions and improve in this country in a bid rules and regulations that exhibited their products ties between the two countries,” for external cooperation at the Tehran show included edition are mainly technology-based Bausano, which produces top- and“The they Italian can firmsshare attending their advanced this the presence of Germany, Austria "Into benefit the future from when future ground would be current situation will change class extrusion plastic, COMAC, technology and equipment with andsaid Switzerland Giacinto. He indicated also said their that pavedcooperation," for cooperation he said. He between added: us and the soon,"and he Isaid. firmly Merlijn believe van that Essen, the which designs and manufactures Iran’s petrochemical industry willingness to stay in Iran’s market. Iranian side, we will be able to study plans for sales manager at Austrian PureLoop the transfer of technology and training staff." (Erema Group), said Erema was one of the most reputable companies in plastic recycling. Erema No Intention to Cut Iran Ties A large number of European and Asian private edition. Referring to restrictions imposed by the US companies that have entered Iran's polymer and onGroup doing has business been present with Iran, at "Iran he said: Plast" "The from Iran the market first plastic industry in recent years are happy with their enjoys numerous potentialities and I hope for a bright perspective in our cooperation with the Iranian party." about the impact of US sanctions, they say they have nocooperation intention withof cutting Iranian cooperation companies. with When Iran, asked citing the attractiveness of Iran's market. ofYannis Iran's Haritakis, petrochemical export industry. sales manager Our minimum at Greece's Rudi Scheman, director of exports at a Swedish expectationPLASTIKA KRITIS from the S.A., Greek said: government"We are one isof to customers bring back company, said his company had two representative ties with Iran to the past levels." The representative of China's Ruigao Machinery Factory said his company had markets mainly in the Middle East – Iran, Lebanon offices in Iran. "Sanctions may cause such problems as and Saudi Arabia – and South America –Argentina and regardlessforeign currency of US pressure,"fluctuations he and said. make money transfer Brazil. difficult;Jean-Clause however, Girgenti, we willmanager be present of trade at developmentthe Iran market "US sanctions could not hinder cooperation between Chinese companies and the Iranian side. I personally technology and equipment to Iran would face no US-led believe that a brighter horizon will open for Iran's obstaclesat a French so firm, that expressed"our presence hope in that Iran's transfer petrochemical of petrochemical industry by the end of the year," he said. industry" would be strengthened more than ever. "In addition to transfer of technology to Iran's "Political tensions and US-led pressure have caused petrochemical producers, we are willing to hold training 18 problems for working at Iran's market. But we follow courses for the staff," he added. 19 September 2018 Issue No. 75 monthly Iran Plast

th Norouzzadeh said Iran Plast petrochemical products. “In the commercial chains.” She said that 12 Iran Plast in Tehran provided a good chance for car manufacturing industry, we Iran Plast provided a venue for “the cooperation between producers have tried to increase the plastic upstream sector (supplier) and the and consumers. “Since the start share due to its light weight and downstream sector (consumer) to Polymer Products Manufacturing of Iran Plast in Iran, we have seen low costs. Therefore, we have seen stand together, discuss their needs the number of participants grow. It plastic consumption grow in this and prepare the ground for better shows the prosperity and progress commercial ties.” “At this exhibition, of petrochemical industry,” she said. said that Iran Plast was an event with global actors present, we Up 10% in 20 Years industry,” said Bosaqzadeh. He complying with global standards. hope to be able to facilitate more ran’s annual 12th Iran Plast plants were faced with no shortage boosted,” said Shahdaei, a former Polymer Products Up 10-Fold “Due to the rapid progress of interaction between consumers and of feedstock, Zangeneh said: CEO of National Petrochemical Ali-Mohammad Bosaqzadeh, technology in this industry and the producers, exchange experience and “Petrochemical production in Iran Company (NPC). She referred to I director of NPC projects, said diversity of needs related to plastic take advantage of potentialities in showcasedSeptember their 24-27 products. in the Visitors capital the development of Iran’s polymer Iran’s polymer production rate industry, this exhibition provides a different sectors,” said Alavi. cameTehran. from 20A total nations of 35 to countries hold talks market, saying: “In a bid to complete has increased 10-fold since 2002 good opportunity for the exchange with Iranian companies. Such suppliedhas grown to 7-8% petrochemical year-on-year.” plants the value chain the petrochemical of technical knowhow, supply and Value Chain Completion Target number of visitors against the He said more ethane was to be industry as fast as possible, we was held. “The number of polymer introduction of new products,” said Qodratollah Farajpour, director of backdrop of US sanctions indicates trying our best to boost our exports have to take steps towards applying when the first round of Iran Plast production plants has reached 27 Bosaqzadeh. production control at NPC, said: despiteacross Iran, problems.” adding: Owing“We are to also Iran’s modern technologies. Of course, “In order to complete the value and plastic industry at the regional relative advantages in the energy those involved in this industry Iran Planning for Market chain, appropriate measures have andthe significance global levels. of Due Iran’s to thepolymer high sector, polymer and plastic industry are making efforts towards such domesticnow, from and 4 in global 2002. demand,It shows andthe Development been undertaken and efforts are quality of Iranian-made products in Iran has seen a progressive trend a goal.” Shahdaei highlighted the growthsignificance in this of industry,”plastic industry, he said. Farnaz Alavi, director of planning under way to that end.” “This and low cost prices, Iran remains over the past 17 years. In spite of all at NPC, said Iran’s petrochemical international event is a good highly attractive in this sector. twists and turns in the polymer and the previous Iran Plast exhibitions, consumption of polymer products industry has been widely present platform for cooperation, deepening To that effect, Iran’s Ministry of plastic market, Iran’s products have significance of Iran Plast, saying: “In wasHe saidinevitable that production in Iran and and communications between domestic Petroleum has been developing attracted more buyers. hope to see the same after the end of elsewhere. “Since the petroleum managed to supply our products actors of petrochemical industry and related projects in a bid to win thewe receivedcurrent one positive too.” feedback. We industry is intertwined with in international markets. “We have foreign participants. Undoubtedly, Domestic Manufacturing a bigger share of global polymer different sectors including car preserve the current standing holding this exhibition regularly will Marzieh Shahdaei, a senior Petrochemical Exports Grow and plastic markets. According to manufacturing, aviation and ofat aIran’s good petrochemical quality. We expect industry to be instrumental in the realization Reza Norouzzadeh, CEO of NPC, households, Iran Plast has always due to the volume of hydrocarbon sanctions would help strengthen said Iran has been lifting its number of its polymer production attracted visitors from various reserves we hold. In the future, we said the motto chosen for this domesticPetroleum manufacturing. Ministry official, said petrochemical exports. official data, Iran has brought the sectors,” said Bosaqzadeh. expect a stronger presence in global year’sof these Iran objectives,” Plast – Plastic he said. Industry He “Furthermore, given the 2018. Furthermore, Iran is close to markets,” she said. Referring to the Business Prosperity – highlighted commissioning of different launchingplants from 21 4 morein 2002 polymer to 27 inprojects. eliminated from many household private sector’s investment in this the objective of the exhibition for petrochemical projects, we are He said Iran’s petrochemical Minister of Petroleum Bijan productsHe said that to metal has been industry, Alavi said: “Due to business development through more witnessing growth in the plastic calendarexports grew year 24%which year-on-year started on Zangeneh said at Iran Plast that be replaced the diversity of our products cooperation. industry and raw material supply. during the first half of the current Iran’s petrochemical industry was with we may win more markets Therefore, was no problem with plastic and including in African and Long-Term Contracts companies March 21.petrochemical He added that exports. there Plast exhibition was an opportunity South American nations, active in this formaking Iranian progress. and foreign He said companies that Iran and expand of Petrochemical Commercial to exchange views about broader sector are Company,Mehdi Sharifi said Niknafs,petrochemical CEO cooperation in the future. industry was the beating heart Noting that petrochemical of Iran’s development. “Like a locomotive, the petrochemical industry can be the driver of growth in other industries,” he added.

20 21 Contract September 2018 Issue No. 75 monthly Contract

An agreement has been signed between three Iranian companies for the construction of 10-million-barrel crude oil storage tanks and utilities in Jask Port. The Build- Operate-Transfer (BOT) contract was signed between Touraj Dehqani, CEO of Petroleum Engineering and Development Company (PEDEC), and Asghar Gorzin, CEO of Petro Omid Asia, and Ahmad Ebrahimi, CEO of Omid Investment Management Group. Under this trilateral deal, 1 mb/d of crude oil would be transferred from Goureh oil terminal in Bushehr Province in southern Iran to Jask off the Sea of Oman. That would help Jask shot to prominence as the second oil export terminal in Iran. With an initial investment of €200 million, the project will come online over three years. That would require the investor to finance and design the project, supply required commodities and equipment, and construct storage facilities. After that, the investor is required to be accountable for maintenance for a 15-year period. After 18 years, the storage site would come under ownership of National Iranian Oil Company (NIOC).

li Kardor, CEO of Iran. A chain of activities to 20 million barrels,” he NIOC, said Iran had is needed for the transfer Apotential to reach of crude oil from Goureh to has focused on the strategy 6mb/d oil production Jask. “Contractors in each ofadded. outsourcing. “Since 2014, To that NIOC end, capacity. “Currently we can and every segment of this it has assigned the private allocate 2.5 mb/d of oil to chain are required to comply sector operation of an oil ???????? with timeframe set forth in reliance on new investments order to prevent any delay (LNG) projects, as well as domestic refineries. With in the implementation of the powerfield, liquefied plants,” naturalKardor said.gas project,” said Kardor. “Given couldthe figure also couldstore besurplus raised oil to Iran’s plans to raise crude oil storage tanks at Jask was produced3 mb/d, and in thein this country,” way we oil production capacity and anHe instancesaid the dealof the signed private for he said. Development of develop crude oil storage sector’s involvement in oil the Makran area, due to its tanks, construction of storage projects. proximity to East Asia, can tanks will be done in two “I hope that Petro Omid Asia Co. and Omid Investment in Iran’s export terminals. the storage capacity stands Management Group would Khargcontribute Island to isdiversification currently atphases; 10 million in the barrels first phrase, and in go ahead with this project as Iran to the main export terminal in the next phase it will double planned,” said Kardor. Build Oil Storage Tanks in Jask Port

22 23 Contract September 2018 Issue No. 75 monthly Contract

No Plan to Cut Output sign our next contract with stabilizing Iran’s standing added. “Earlier, the Ministry developing Makran area and stations, measurement and Kardor dismissed a consortium comprising within OPEC and world of Petroleum had started implementing the Goureh- mechanical tools, oil storage speculation about plans Russian companies.” Asked markets,” he said, referring development in the Persian Jask oil transfer pipeline tanks as well as an export by Iran to reduce its oil about insurance coverage to the Organization of Gulf. Now it is pioneering project. jetty,” he added. production. for oil cargoes, Kardor said: the Petroleum Exporting development in Makran,” “The planned construction Access to high seas and big “NIOC has access to its whole Countries. Referring to the said Shahdaei, a former CEO of oil storage tanks in Jask oceans, proximity to Indian oil income and this year this procedure completely development of oil and gas of National Petrochemical Port is part of the Goureh- subcontinent countries as we have even experienced by“We ourselves are currently and we handling have fields in Iran, Kardor said: Company (NPC). Jask oil transfer project. This well as the great Indian and growth in revenue gained accepted to hedge risks.” “Development of the jointly She noted that implementing project is being followed up Chinese markets, linking from selling crude oil,” he owned South Pars gas field major oil projects would on seriously and will result Central Asia, Russia and said. Oil, Gas Fields require domestic and foreign in national development in Afghanistan to high seas and Kardor added that NIOC Development see new phases come online southeast,” he added. “In the Indian Ocean via North- was easily receiving money Petroleum Ministry senior thisis still year under and way.next Weyear will to sanctions provided a proper addition to the development South Corridor, desirable official Marzieh Shahdaei contribute further to gas investment.“However, of this sector, diversifying oil sea depth, attractive also said that the Iranian said petroleum industry production.” export origins and feedstock and diverse beaches, Ministryfor crude of oil Foreign shipments. Affairs He is instrumental in Iran’s Shahdaei said NIOC was havechance to fortake further advantage benefiting of supply to downstream units geopolitically strategic and and the European Union economy due to its big in talks with Iranian and thesefrom domestic potentialities potential. in the We are targeted in this project,” unique location, investment- NIOC has were in talks to develop share in national revenue. foreign companies for the best possible way,” she said. said Dehqani. friendliness and being The planned access to its models to be applied under “The Ministry of Petroleum potentially able to house construction whole oil different circumstances. and NIOC have worked “Enhancing crude oil Maximum Use of oil transfer project and its economic and development of oil storage Asked about any new deal out mechanisms for this productiondevelopment capacity of oil fields. and Domestic Potential utilitiesHe said werethe Goureh-Jask estimated to projects and proximity income and under the newly developed industry to remain dynamic. building this terminal, Dehqani said PEDEC cost $2 billion. “This project to the Persian Gulf, and tanks in this year we Iran Petroleum Contract That would help us make we will be able to bring was determined to includes building of about giant proven oil and gas Jask Port is gains from oil sales in diversity to our crude oil make maximum use of 1,000 kilometers of pipeline, resources, are among have even currently in talks and we may addition to upgrading and export terminals,” she domestic manpower in features of the Makran area. part of the experienced (IPC), he said: “We are Goureh-Jask growth in five roadside pumping oil transfer revenue project. gained from This project selling crude is being oil followed up on seriously and will result in national development in southeast

24 25 South Pars September 2018 Issue No. 75 monthly South Pars

port in the Persian Gulf with II zone. Therefore, it is able to commodities complete projects and provide needed in this port. NIOC Eyes More Export Terminals jetties; two LPG jetties for LPG any services for the entry of exportsa 37-meter having depth, each it hascapacity three to products and exports. But for Is it the first port in which South Pars to Export Products via Tombak berth vessels carrying 5,000 to the time being, it is only used caisson material has been 50,000 tonnes of LPG and one for sulfur and LPG exports. ith the completion mcm/d of gas from South Pars. sweetening operation in all used? sulfur export jetty able to load Yes, that is true. Generally of new phases of Development of South Pars is at Iran’s ports, buttress and the giant offshore under way. Iran LNG and SP 11, complexes located in Pars I zone According to plans, the LPG jetty However, in the future once Siraf topdrive are often used in the inrefinery Assaluyeh phases. deliver The sulfurrefining via is14,000 to come tonnes online a day by nextof sulfur. March products.refineries Itbecome may also operational; help export construction of jetties, but due to allow LPG exports. petrochemicalsit may start exporting from plants refined to low depth of water in Tombak NationalSouth Pars Iranian gas field, Oil Companyincluding ParsSP12, II SP13, zone SP14,(Kangan) SP19, covering SP22, due to the lack of a port to located in Pars II zone. Port and due to shortage of (NIOC)SP13, SP14, has decided SP 22-24 to and establish SP19, 16,000SP23 and ha SP24 of land. are located in exportthe Pars sulfur Port Complex.produced However,at Pars suitable stone resources, caisson an export and service terminal Moheyoddin Jafari, POGC II zone, they have to take a long Is this port designed to concrete materials were used. in Tombak in Pars II, where oil and gas projects’ logistics distance to transfer the sulfur export only LPG and sulfur? Could you update us The main mission assigned That is new experience and it is manager, has talked with” Iran by land. The startup of Tombak about the supply of necessary to this port is sulfur and LGP Petroleum” about Tombak and port will facilitate the export of commodities in this port? export; however, Tombak is an The necessary commodities which such materials are used. projecteightW refinery are located. phases The and idea one is its potential. the first jetty and waterbreak in liquefied natural gas (LNG) export and service port, which and equipment have been The western waterbreak or the would be able to provide all purchased for the port and the main waterbreak has a cubic petroleum gas (LPG) and How come NIOC has sulfur When from was the thePars agreement II refineries. necessary services to vessels commodities have been moved structure, whose stone section sulfuraimed producedat exporting by liquefiedSouth Pars. decided to build an export signed for the construction of including container services and to stores. There is no problem is complete, while its caisson According to manager of oil and service port at Tombak? this port? bunkering. Of course, providing for operating different sections section is under construction. and gas projects’ logistics at As you know, South Pars phases services to vessels will be at the of this port. Furthermore, orders The eastern waterbreak is the Pars Oil and Gas Company are being completed one after signed with Iranian contractors discretion of NIOC. Tombak is have been placed with domestic smaller in size and is totally rock (POGC), Tombak will in addition another and its story will come forIn 2014the construction an agreement of the was the only NIOC port in the Pars manufacturers for most of core. to exporting products, help to an end soon. But SP11, SP12, Tombak port and export port provide services to vessels under an EPC contract. The navigating at the port. It would project is now under way. It is be able to export petrochemical areSP13, located SP14, in SP19, Pars SP22, II zone. SP23 Some expected to come on-stream in products from plants in Kangan ofand these SP24 phases and Iran came LNG online plant under the 11th administration did engineering design at the and the rest is being completed. port;2019. however, Iranian companies international also and the refined products of the That is why a port is planned companies were involved in the PortSiraf isrefineries. the deepest With port a depth to be constructed at Tombak in port engineering section. inof 37Iran meters, and the Tombak Persian order to export LPG from the Known as the deepest Iranian Gulf region. Iran is foregoing phases. Furthermore, currently recovering 570 sulfur is a byproduct of

26 27 Investment September 2018 Issue No. 75 monthly Investment

chancellor of Sahand University of Technology. universities. Noting that Soroush enjoyed high potential for

NIOC officials say Soroush has recovery rate Universities to Help oilof 5% recovery under (EOR) normal methods conditions, would which raise is the much enhanced recovery, he said the heavy crude field lower than that of similar fields. Enhanced likehad misciblea meager gas 5% injection, recovery immiscible rate. gas Under the 10-year agreement, universities will injectionHe cited andvarious chemical enhanced injection. recovery methods Soroush Oil Recovery berecovery required rate to to carry 10 to out 15%. EOR studies in a bid “To that end, good cooperation has taken Soroush, which started production in 2001 in partnership with Royal to devise short-term and long-term plans for shape between IOOC and Sahand University of Dutch Shell in 2001, is known as Iran’s largest offshore oil field. Due to boosting production from Soroush. natural decline in production, this field needs to be upgraded with modern NIOC is currently focusing on maximum a comprehensive action plan for implementing technology in order to be developed. The main reservoir of this field is Technology. We are in the process of drawing up Bourgen located in the west of the Persian Gulf. the country and enhancing oil recovery from of Research and Technology (R&D) at IOOC said. Soroush.efficient recovery from oil and gas fields across enhanced recovery project in this field, the head The head of Research and Technology (R&D) oroush is located in Bushehr Province, technologies to supply more oil. at IOOC recently said that various scenarios for Whereas Soroush recovery could rise to as The heavy crude oil extracted from Soroush enhanced recovery from Soroush were under whosehigh as heavy 15%, weoil isintend highly to viscose”, use the experiencesaid the head of S review in light of partnership between IOOC and ofenhancing Research recovery and Technology in Soroush-style (R&D) at oil IOOC. fields, The more precisely 83 kilometers southwest experience is also to be used to boost the of Kharg Island. Discovered in 1962, the terminalis blended before from beingthat of sold nearby by the Norouz Directorate field field became operational at a rate of 14,000 b/d ofto Internationalbe shipped to Affairsthe Persian of National Gulf floating Iranian Oil after the drilling of the first well. The field was Company. recovery of this offshore oil field.” harmed severely during the 1980-1988 imposed A major advantage with the Soroush platform war. The field halted production during the is its simultaneous supply and export of conflict. Arrangements for the renovation of this oil and gas. Furthermore, it is among rare fieldIran’s started Ministry in 2000 of Petroleum and development introduced of the Soroushfield began for two foreign years investment later. during a implemented. Before Shell, American and Italian conference held a couple of years ago to roll platforms where no flaring projects have been out a new type of oil contract. Iran hopes The head of reservoir engineering at IOOC has saidcompanies that Soroush were developing needed the the involvement field. of companies’ capital and cutting edge technology. international oil companies. toDuring lift output 15 years from of old production, fields by using Soroush big hasoil Sahand University Assistance Enhanced recovery from Soroush producedSoroush last only underwent less than 3% development of its reserves, under or started recently in the wake of aabout buyback 360 dealmillion with barrels Shell inof 2000.oil. Under this an agreement signed between deal, 10 horizontal wells were drilled in the IOOC and Sahand University of Technology. The agreement was signed by CEO of IOOC and 21.field. The In APItotal, gravity there areof the 32 oil wells currently in Soroush, being producedproducing is oil 18. with an API gravity of 14 to

Iranian Offshore Oil Company (IOOC); however, itSoroush is among remains the oldest the largestoil reservoirs field owned in Iran. by As the

a mature and brown field, it needs modern

28 29 Investment September 2018 Issue No. 75 monthly Investment

million barrels of which is bcf of gas. The significant $100 billion opportunities recoverable. point with the discovery for investment in Iran’s oil Halegan’s gas and of this gas field is that all and gas industry, saying Halegan Gas Field Up condensate deposits are geophysical, reservoir and Iran needs big foreign estimated to be valued at petroleum engineering investment. $83 billion, while discovery studies, as well as reservoir He has highlighted the of this gas field had cost layer tests were handled vastness of Iran’s oil and for Investment only $36 million over 2.5 by the Directorate of gas facilities across the alegan is among industrial sectors and firmly 2D seismic test project was years. Development of Exploration of NIOC. country, saying they require Iran’s ten gas fields seeking to increase its gas carried out on 1,000 square Halegan would allow a Fars Province is a gas hub development activities on a whose investment production capacity. To that kilometers of land a year sustainable output of 50 in the Middle East region. large scale. H mcm/d of gas over a 20- Some exploration studies in The analyst said in plan was presented to effect, onshore fields are in earlier in Fars Province. a Tehran international the limelight for domestic The seismic test ended in year period. this province have proven addition to exploration conference a couple of years and foreign investment the discovery of Halegan and The director of Exploration the existence of huge gas activities needed ago. due to easy access and low several other gas fields. Directorate at NIOC has said reserves. Halegan is the to expand facilities Halegan is located in Fars investment needed for their Halegan measures 50 that exploration drilling latest gas reservoir whose by attracting fresh Province in southern Iran. development. kilometers long and 11 operations were very tough existence was proven there. investment; existing oil It is 73 kilometers north of National Iranian Oil kilometers wide. It holds and slow due to stiff land Compared with gas fields facilities are in desperate Assaluyeh and 25 kilometers Company (NIOC) intends 12.4 tcf of gas (355 bcm) of composed of high-pressure located nearby, Halegan has need of renovation due to south of Sefid Baghoun gas to establish a gas hub in gas reserves in place, 8.938 layers. A 4,999-meter deep bigger dimensions. the maturity of oil wells. field. It neighbors Sefid the south of Fars Province. tcf of which is recoverable well was drilled in order to Iran’s efforts to return to its “With opportunities Zakhour and Dey gas fields NIOC’s gas production thanks to a 70% recovery yield better results. Later genuine standing among gas introduced by Iran for from north. and refining plan involves rate. Such high recovery rate on, several reservoir layers exporting countries herald a investment we have to In a bid to gain a 15% development of Sefid is rare for gas fields in Iran. including Kangan, Upper tough road ahead in coming see which companies share in global gas trading, Zakhour, Sefid Baghoun, Furthermore, Halegan Dalan, Nar and Lower years. and governments would Iran is implementing gas Halegan and several other is estimated to hold 249 Dalan, were appraised. An analyst with energy take the initiative. These efficiency plans in the gas fields. Halegan was million barrels of gas In the end, the field was consultancy Wood opportunities would benefit housing, commercial and discovered in 2005 when a condensate in place, 98 estimated to hold 12,400 Mackenzie has highlighted both sides,” he said. 30 31 Petchem September 2018 Issue No. 75 monthly Petchem

hase I of Ilam Petrochemical Plant was 2016 with an initial investment of $627 million. P Itinaugurated was designed by Iran’sby Petrochemical first vice-president Industries in July 15 Petchem Projects Online The projectinaugurated came online in 2014 with during a capacity a provincial of Design and Engineering Company (PIDEC) tour by President Hassan Rouhani. with technologies provided by Switzerland’s Casale SA and Japan’s Toyo. Iranian engineers 300,000 tonnes. The investment made in the handled detailed design, purchase engineering, Until eight years ago, everyone in 5 was worriedYears about incomplete petrochemical projects. project stood at $442 million with its output a major industrial project in Iran, equipped implementation, pre-commissioning and But today, the same projects are offering a variety of petrochemicals, which largely withvalued ethylene, at $388 high-density million. The Ilampolyethylene, plant remains commissioning. contribute to the Iranian economy. The accelerated development of petrochemical feedstock desulfurization and all utilities units. projects under the 11th and the 12th administrations resulted in the development of a Creation of job in the province, optimal use of to 5,000 indirect jobs. The value of its product is large number of products. Iran raised its annual petrochemical production capacity to 54 million refined gas products and their conversion to The project created 500 direct jobs and 4,000 tonnes last March, while the number of petrochemicals manufactured in Iran has reached 123. petrochemicals of high value-added have been More importantly, over the past five years, a total of 15 petrochemical projects came on-stream, among objectives of implementation of this estimatedTakht Jamshid at $264 SBR/PBR million. Unit which we briefly review here. project. The Takht Jamshid SBR/PBR Unit was inaugurated by Iran’s first vice-president in Lorestan Petrochemical Plant February 2017. Takht Jamshid Petrochemical Lorestan Petrochemical Plant was inaugurated Company is located in Site 2 of the Special Economic Petrochemical Zone. In Phase 1, the

low-densityby Iran’s first linear vice-president polyethylene in April (LDLP) 2016 and with high- an SBR and PBR. The PBR unit, with a capacity annual production capacity of 330,000 tonnes of project will be supplying 45,000 tonnes of In Phase 1, throughout construction and 200 jobs during Takht Jamshid density linear polyethylene (HDLP). operation.of 35,000 tonnes The products a year, createdof this unit 700 are jobs used Petrochemical Located on a 130-ha land, the Lorestan plant as raw material for rubber industry. The projectis fed by was 234,000 inaugurated tonnes witha year an of initial feedstock capital Petrochemical Commercial Company has Company supplied by the West Ethylene Pipeline. This indigenized PBR production technology. TJPC will be incorporates an SBR production unit with a of $300 million with the value of its products supplying standingUrmia Petrochemical at $329 million. Plant Sulfuric Acid production unit with an annual capacity of 45,000 tonnes Unit 18,000capacity tonnes. of 30,000 The tonnes technologies a year andused a in PBR this of SBR and The Urmia petrochemical plant was inaugurated facility are Goodyear for SBR and Goodrich for by President Rouhani in May 2016. The sulfuric PBR. PBR. The PBR acid unit of this petrochemical plant has an unit, with a annual production capacity of 50,000 tonnes. Karoun Petchem Plant The investment made in this project was $10 Phase 2 of Karoun Petchem Plant was capacity of inaugurated with the commissioning of the 35,000 tonnes Due to allotment of human resources and utilities, methylene diphenyl diisocyanate (MDI) unit itmillion would with be possible its production for the valuedplant to at boost $4 million. a year, created production capacity. Iran’s first vice president in February 2017. 700 jobs Phasewith an 2 annualof Karoun capacity Petchem of 40,000 Plant has tonnes five by Mahabad Petchem Plant throughout valued at $116 million. construction inaugurated by President Rouhani in May 2016. units. It has cost $407 million with its products and 200 TheMahabad idea behind Petchem this Plant project was was officially to develop Kurdistan Petchem Plant petrochemical products in Iran, create jobs and Kurdistan Petchem Plant is one of 12 jobs during develop petrochemical exports, make optimal use petrochemical projects lying in the category operation of gas resources in Iran and generate value-added of resilient economy. It has had a big share from national assets in partnership with Iran’s in industrial development, creation of value- National Petrochemical Company and private added and job creation in western and investment. The Mahabad plant is among the 12 northwestern Iran. It was inaugurated in April 2017 by President Rouhani. A total of Ethylene Pipeline. The investment made in this petrochemical projects located along the West Construction of the petrochemical plant started in$378 2005, million but it was faced invested a six-year in this halt project. before being project stands at $388 million with the value of resumed in 2011. The products of the Kurdistan itsMarvdasht output estimated Petchem at Plant$329 million. plant are used as feedstock for downstream Shohada-ye Marvdasht Petrochemical Plant was units, and in the production of polyethylene 32 33 Petchem September 2018 Issue No. 75 monthly Petchem

films, polyethylene foams, wire and cable Entekhab Industrial Group’s Polystyrene from the monomer styrene. Polystyrene can be Power Plant was built to supply electricity coating and plastic materials. Unit solid or foamed. General-purpose polystyrene is The polystyrene unit of the Entekhab Industrial clear, rigid, and rather brittle. It is an inexpensive 2 of the Pars Special Economic Energy Morvarid Petchem Plant’s MEG Unit Group which has production capacity of 250,000 resin per unit weight. It is a rather poor barrier Zoneto 24 (PSEEZ).petrochemical The initial plants investment located in madePhase The MEG unit of Morvarid Petchem Plant was tonnes a year of polystyrene was inaugurated in to oxygen and water vapor and has a relatively inaugurated by President Rouhani in April April 2017 by President Rouhani. A total of $200 low melting point. Polystyrene is one of the most unit is currently supplying electricity to the 2017 with a view to producing ethylene glycol million was invested in this project. Technical widely used plastics, the scale of its production Mehr,in this Morvarid, project stood Kavian, at $366 Entekhab, million. Takht This in different grades. This unit was designed knowhow provided by Norway and Germany being several million tonnes per year. Polystyrene Jamshid, Marjan and Bushehr plants as well has been used in this project whose output is can be naturally transparent, but can be colored as compressed air separation unit among products. The main feedstock for this unit are with colorants. Usages include protective others. Equipped with two main boilers and and built to produce 554,000 tonnes a year of packaging (such as packing peanuts and CD and an auxiliary boiler, the Damavand Power estimatedTakht Jamshid to be valued Pars Petchemat $326 million. Plant’s DVD cases), containers (such as “clamshells”), Plant is currently producing 780 tonnes an 340,000 tonnes a year of ethylene supplied by Polystyrene Unit lids, bottles, trays, tumblers, disposable cutlery hour of vapor which is fed into the Mehr, the olefin unit of Morvarid Petrochemical Plant, The Polystyrene Unit of Takht Jamshid Pars and in the making of models. Morvarid, Kavian and Marjan petrochemical and 368,000 tonnes a year of oxygen to produce initial investment made in this project stood at Petchem Plant was inaugurated by President plants. In the future, plants 554,000 tonnes of ethylene glycol a year. The Rouhani in April 2017. The construction of Takht Phase 3 of Pardis Petchem Plant under construction in MEG unit is domestically manufactured. The MEG Jamshid Pars Petchem Plant began in early 2015 Phase 2 will be supplied $300 million, while 90% of equipment used in the unit’s products are monoethylene glycol (MEG), with the objective of producing 65,000 tonnes inaugurated by President Rouhani in with vapor from this Phase 3 of Pardis Petrochemical Plant was diethylene glycol (DEG) and triethylene glycol a year of polystyrene products. The investment September with an annual production power plant. The (TEG). made in this project stands at $70 million with capacity of 1.75 million tonnes of urea and Damavand project ammonia. The project, which was started Phase 2 of Kavian Petchem Plant was inaugurated a synthetic aromatic hydrocarbon polymer made by President Phase 2 of Kavian Petchem Plant, known as the the products valued at $69 million. Polystyrene is estimated to bring its urea production to Rouhani. largest producer of ethylene in the Middle East, in 2011, has cost $582 million. Phase 3 is has an annual production capacity of over one of the target for this project. million tonnes of ethylene. It was inaugurated 522,000 tonnes, which would account for 70% Marjan Petchem Plant’s Methanol Unit million. Construction of the project started in The methanol unit of Marjan Petrochemical 2006.in April Phase 2017 1 with became an initial operational investment in 2012. of $313 Plant has a production capacity of 1.65 million tonnes a year. The project was inaugurated by million. President Rouhani. During operation, it The products of this plant are valued at $929 will create 250 job opportunities. The investment made in this

million with the products projectvalued stands at $577 at million$914 a year.

Damavand Power Plant The Damavand

34 35 Report September 2018 Issue No. 75 monthly Report

last train is set to come online by November. with other development phases at South Pars, 16 mcm/d of sour gas, which would soon reach out and transfer to location. When compared South Pars to See Output The first two trains have been processing about potential and domestic manufacturing. The SP14 has used maximum techno-engineering The25 mcm/d. recovery Manouchehri capacity of eachsaid SP13of main was and more equipment including metal structures, pumps, than 92% complete in the refinery section. powermanufacturing cables and of moreinstruments, than 95% drums, of refinery pressure lans for the developmentHike of remaining Anewinstalled, the two platforms would increase the tanks, towers and boilers has been assigned to South Pars gas production capacity by 28 mcm/d. issatellite to be complete platforms in in November, SP13 is 500 allowing mcm/d. rich The gas Iranian companies manufacturing equipment Punder way by National Iranian Oil Company Other platforms under construction at South Pars recoveryinstallation from of offshorethe South platforms Pars offshore 13B andreservoir, 13D for petroleum industry. No foreign contractor is (NIOC).phases Extensive of the activities giant South are underPars gas way field at are which is shared with neighboring Qatar. That

inare the 14D, past, 23 adding: and 24A. “But Manouchehri owning to thesaid client’s transfer bcf/d. currentlySP22-24 presentNearing in Maximum the development Output of SP14. recentBushehr months. Yard where Two platforms 10 platforms have for already SP22-24, been assistance,of platforms on-site by vessels engineers had become developed difficult creative would bring SP13 gas recovery capacity to 1 SP13 and SP14 have been under construction in methods for the transfer of 2,500-tonne platforms SP14, Most Iranian Phase for engineering and development, Gholam-Reza from land to sea.” “The commodities purchased Manouchehri also expressed hope that the areManouchehri already operational. said a third The refining third train train is is to to be Manouchehri,loaded out for hasSP13. announced The deputy that CEO the ofSouth NIOC Pars from abroad became operational by private beadded fed byto thegas SP22-24,from SP6-8 where in November. two refining Farhad trains companies at high standard levels,” he said. “At Izadjou, who is manager of this project, said Bushehr Yard, 1,700 service workers are currently stagerefinery of physicalof SP14 wouldprogress. start One operation platform soon. of this increasedoutput would gas productionincrease by was3 bcf/d planned up to to March meet “The onshore section of SP14 is at a good domestic2018 when need new in Iranian winter. year Manouchehri begins. He said said the the while Platform C, which had been loaded out completethe refinery and would according receive to gasplans, in December.a sweetening remaining platforms would have been moved bothemployed. onshore When and there offshore was purposes,” more activity, he added. the inphase September, is producing is to comewith aonline capacity soon,” of 14 he mcm/d said. trainThe refinery has come of online,SP22-24 using is more sour than gas supplied92% offshore before next March, adding that six new Manouchehrifigure stood at said 3,500. Iranian There engineers is equipment were for doing a “Therefore, the capacity of recovery from by SP6-8. In case required sour gas is received, phases would come online at South Pars with a great job at South Pars, which would contribute to the two platforms of this phase would reach sweetening operations would begin at the rate combined production capacity of 6 bcf/d. “Load- higher gas supply in winter. Manouchehri said an 28 mcm/d, which is equal to the output of a of 12.5 mcm/d, to be fed into national grid. obligation for a 100 mcm/d output hike in South conventional South Pars phase.” The third Pars required round-the-clock work and efforts. out of Platforms 13B and 13D, as the main and the “Despite challenges lying ahead, contractors on-stream in winter to increase gas tosatellite be transferred platforms to of their SP13, location has been in thealready Persian done and operators have voiced their readiness for offshore platform of SP14 is to come and these platforms would be installed on FLB124 achieving this objective,” he added. mcm/d. Installation of satellite from designing to construction of the two giant production from this phase to 42 offshoreGulf waters,” platforms he said. weighing He noted about that 2,200all stages tonnes SP13 Case to Close each have been handled by Iranian engineers. The third train of platform 14C, the second platform of SP14, will be done after load- Mojtaba Mohammad Qoli Photo: used in the construction of the platforms had has also become sweetening at SP13 beenHe said supplied that the by equipment domestic manufacturers.and commodities Once operational and the

36 37 Opec September 2018 Issue No. 75 monthly Opec

to lower domestic consumption, consumers of Iran’s oil because but it could not replace Iran’s oil mb/d and is sticking to this other suppliers of oil could not by itself. Therefore, in order to production.production atIt themeans level that of 3.805Iran’s practically supplant Iran for satisfy the US president, other oil production is 7,000-8,000 oil shortages and that would parties that are able to supply b/d higher than its OPEC quota,” probably push up prices,” said extra oil jump to the fray.” he said. “In the meantime, Kazempour Ardebili. Kazempour Ardebili said: “For this reason, the Americans “Russia has currently extra oil producing at full capacity and it are likely to grant waivers to capacity. It had earlier cut its our domestic refineries are different countries for buying oil from Iran. The ceiling for such now returned about 265,000 wouldis continuing.” increase He once said new that Iran’s waivers may be 1 mb to 1.2 mb b/doutput to theby 300,000market. Ib/d don’t and think has phasesrefined ofpetroleum the Persian products Gulf Star barrels. This issue has happened Russia would have much extra oil to supply on the market.” That would help Iran export he added. Kazempour Ardebili Refinery become operational. touchedin the past, on inthe 2014 honoring and 2016,” of declines in some northern areas neighboring nations. the 2016 agreement between like“We Siberia know thatin winter production and Russia refined petroleum products to OPEC and non-OPEC producers, cannot continue [supplying saying: “Iran was earlier in extra oil]. Everyone is now “We have also developed agreement with a 1.8 mb/d decline in OPEC/Non-OPEC that even all producers are not oil output and had signed the US Emerges Loser ablefacing to a supply litmus as test. much We oilthink as agreement. It is not opposed demanded by Donald Trump, to it either, and approves the the president of America,” he agreement for the release of in JMMC Meeting added. “Therefore,” said Iran’s stocks.” “This agreement was The 10th meeting of the Joint Ministerial nations and review their governor for OPEC, “Trump has signed in 2016 and two years Iran was Monitoring Committee (JMMC) of OPEC and commitment to their production Trump has to show some have since passed. Members non-OPEC producers was held in Algeria against quota. Such committee would buyers of Iran’s oil, for instance flexibility vis-à-vis buyers of have since tried to consume earlier in the backdrop of US President Donald Trump’s regularly hold meetings inviting upto show to a ceiling some flexibilityof 1.5 mb/d vis-à-vis or Iran’s oil, for instance up to supply glut which had been agreement Some ministers and experts. 1.2 mb/d.” “Given the present accumulated in the market from tweet threatening some Persian Gulf oil producers. “We a ceiling of 1.5 mb/d or 1.2 with a 1.8 countries protect the countries of the Middle East, they would not be Iran’s governor for OPEC also circumstances, Trump has no mb/d. like Saudi safe for very long without us, and yet they continue to push dismissed the idea of cutting option but to back down from crash,” he said. Kazempour mb/d decline Iran’s oil exports to zero, saying: his plan to fully halt Iran’s oil methods for controlling Ardebili2014 to 2014,said Iran causing had noprice role in Arabia claim for higher and higher oil prices! We will remember. The in OPEC/ OPEC monopoly must get prices down now!” tweeted the US domestic consumption in order the stocks because it was under to have extra president. In response, Iran’s Minister of Petroleum Bijan go to non-OPEC members.” over a short period of time like to preserve exports levels sanctions during that period. Non-OPEC “We should not let OPEC shares forexports,” two months, he added. they “However, may tap and meet national demand,” “At that time OPEC and non- oil output capacity, but Zangeneh described President Trump’s tweet as the biggest prevailing in the oil market and their own strategic petroleum OPEC agreed to reduce their we have so affront to regional governments and nations allied to the theHe statussaid that of oilconditions producers did reserves and supply oil to warned that the persistence of oil output by 1.2 mb/d and and had United States. “I hope that such threats would not strike far not seen the market to supplant Iran’s USsaid sanctions Kazempour against Ardebili. Iran wouldHe 600,000 b/d respectively, signed the fears among some of my OPEC colleagues to persuade them for Iran’s crude oil. “Global output. But that would not drive up prices sharply. “That totaling 1.8 mb/d annually,” any increased to implement President Trump’s orders,” he said. “OPEC is demandnot allow for finding crude a oil replacement will keep be possible in the long-term,” would incite the international agreement. supply or an organization independent of the US and I hope it will be growing in case the US imposes Kazempour Ardebili said. community against the US and It is not so forever.” sanctions on Iran’s oil exports “OPEC producers are not able lay the blame on it, but we have meanshe said. such “When amount there must is talk be opposed to extra capacity In 2016, OPEC and non-OPEC for their reduction. But the to wait and see what would deductedof 100% commitment, from the output it of on their part Kazempour Ardebili, who oil producers had agreed to cut question here is to know who of oil up to November [when happen next.” all countries. This amount was it either, and Irepresentedran’s OPEC governor Iran in the Hossein their combined production by could step into the market to USto provide oil sanctions an extra on Iran2.3 mb/d take divided between OPEC and approves the JMMC meeting in Algiers, said 1.8 mb/d in a bid to shore up make up for probable supply effect] to make up for Iran’s oil Trump Has No Option but non-OPEC members in order all participants in the meeting prices. The OPEC/Non-OPEC shortages,” Kazempour Ardebili unless they decide to dip into Flexibility to reduce their oil production,” agreement for had insisted on remaining fully agreement remains in effect up said. “Some countries like Saudi their reserves, which would not Iran’s governor for OPEC also he added. Kazempour Ardebili the release of faithful to oil production cut. to the end of year. Kazempour Arabia claim to have extra meet market demand because it said the oil producing nations stocks Ardebili said participants at capacity, but we have so far not would be a short-term measure President Trump’s efforts to cut have agreed on cutting about for output hike in the OPEC/ the JMMC meeting decided to seen any increased supply or causing price hikes,” he added. Iran’splayed oil down exports the significanceto zero. of Non-OPEC“No figure JMMCwas bandied meeting,” about he set up a committee comprising extra capacity on their part,” he Kazempour Ardebili said that “It seems that he will not which has been endorsed by said. OPEC was announced to OPEC and non-OPEC states in said. “Saudi Arabia may release Tehran had so far resisted succeed in his attempt and Iran.360,000 Asked b/d if from oil prices their wouldoutput, have met its quota commitments order to follow up on the proper from its petroleum stocks on the attempts even before US he will have to back down fall in global markets in case implementation of decisions market and it may be possible sanctions come into effect. from his positions and show adopted by the oil producing in coming months in winter due “Iran has maintained its hit the market, Iran’s governor at 118% while non-OPEC had 350,000 b/d of extra oil would 38 remained committed at 119%. flexibility with regard to some 39 Opec September 2018 Issue No. 75 monthly Opec

against us. Apart from six additional supply boost. said about oil prices is that this member states, others attended Falih said Saudi Arabia had pricefor OPEC has said:rather “What been mayunder be the to mark the anniversary of the spare capacity to increase oil impact of psychological factors, 2016 deal and not for hearing output but no such move was propaganda and sanctions a pro-Iran or anti-Iran agenda,” needed at the moment. threats.” “These factors have said Kazempour Ardebili. “My information is that the Among US objectives are markets are well- supplied. I extent that even production ratcheting up the pressure on hikeinfluenced has not oil reduced market prices,”to the oil producers to raise output world who is looking for oil and said Kazempour Ardebili. “Oil and prepare markets for oil isdon’t not knowable to of get any it,” refiner Falih said.in the sanctions on Iran. Russian Energy Minister prices and due to such Alexander Novak said no conditions,stocks will finallyoil prices squeeze are likely OPEC neither Cartel nor immediate output increase was to move towards $60 a barrel. Monopoly necessary, although he believed Therefore, OPEC members are Mohammad Sanusi Barkindo, a trade war between China and mindful of this issue. Of course, OPEC Secretary General, said the United States as well as U.S. the parties which have been at the JMMC meeting that the sanctions on Iran were creating asked by the US to raise output Organization of the Petroleum new challenges for oil markets. The biggest are trying to supply some extra Exporting Countries was Oman’s Oil Minister oil on the market in a bid to neither a cartel nor a monopoly. issue is not Thanks to these appease the Americans and at “I might add here that Al-Rumhy and Kuwaiti with the courageous the same time they tolerate the this transparency extends counterpartMohammed binBakhit Hamad al-Rashidi producing pressure resulting from prices,” to everything we do as an told reporters after the countries, efforts and an he added. Organization. As such, it should JMMC’s talks that producers unprecedented Referring to OPEC member be evident that OPEC is neither had agreed they needed to it’s with the cooperation states’ view of oil price, he said: a monopoly, nor a cartel, but focus on reaching 100 percent refiners, “All nations are making efforts a responsible global body that our Conference in Oran, where has come to be valued as one of their customers’ needs in a compliance with production it’s with the that to maintain the price at about consistently strives to maintain OPEC proactively rose to the the most sought-after reference reliable and secure manner. cuts agreed in June. demand. transcended $80.” stability in the oil markets, in grave challenges presented materials for policymakers, That effectively means We in Saudi “As far as we know, OPEC the interests of both producers corporate decision makers, inclusive dialogue with all compensating for falling Iranian borders, there members, including Saudi Algeria, and indeed Algiers, analysts, the media and the majorWe continue stakeholders, to have includingopen and production. Al-Rumhy said the Arabia have will be a Arabia, favor $80,” said have a vested, mutual interest hasby the become global the financial “city of crisis. turning general public,” he said, adding: consumers, in an effort to exact mechanism for doing so not seen chapter in the Kazempour Ardebili. inand the consumers,” healthy growth he said. of the “We points” for our industry,” “Transparency of data is and consider common issues of had not been discussed. demand global economy.” “Being back he said. “And indeed, this always has been of utmost concern regarding market Falih said returning to 100 for any history books may agree to modify their afternoon, we will have the importance to OPEC. In this stability. And this feedback, percent compliance was the of this industry oilHe output said that due some to political countries brings back so many memories pleasure of commemorating regard, mobile Apps are now naturally, factors into any main objective and should be additional motivations and in harmony ofhere our in extensive this magnificent efforts in city 2016 these determining moments in decision taken by OPEC, and achieved in the next two to barrel that with US sanctions. to restore stability in the global Outlook, the Annual Statistical more recently, by our Non- three months. we did not “Saudi Arabia and the United oil market that had rapidly for this to occur than here in Bulletinavailable and for the MonthlyWorld Oil Oil OPEC friends as well.” Although he refrained from produce Arab Emirates may do so. sunk into a deep decline. Algiers,our industry. where What it all betterstarted place in Market Report, providing specifying how that could be Of course, Russia, which has Indeed, the industry had not 2016,” he added. access to a vast amount of Saudi, Russia Back Down done, Saudi Arabia is the only reached an agreement with seen such a downward spiral Barkindo said: “As part of our from Urgent Hike OPEC, may raise output to some in decades,” said Barkindo. quest as a centre of excellence, the present online and free of Saudi Arabia and Russia were spare capacity. extent in a bid to stabilize its “Thanks to these courageous we continue to promote chargeoil market to all.” data from 1960 to planning in the run-up to the oil producer with significant share in the future and then efforts and an unprecedented information exchange and “In conclusion, this OPEC/ Algeria meeting to increase we need to offset reductions proceed with the same policy,” cooperation that transcended open dialogue on oil market Non-OPEC cooperation will oil output, but in the face of and“We achieve have the 100 consensus percent that he added. “In any case, OPEC borders, there will be a chapter developments and analysis.” continue to enhance dialogue oil market realities and Iran’s compliance, which means we quota should not be given to in the history books of this “This afternoon, we will and build bridges across the position they could not practice industry that will have a title industry. It will work hard to any immediate, additional than we are producing today if member of market monitoring such as ‘The Algiers Accord— ensure a sustainable stability in increase in crude output. therecan produce is demand,” significantly Falih said. more committee.non-OPEC nations. This committee We are not the turning point towards a Outlook,officially whichlaunch is the the 2018 12th the global oil market, enabling “The biggest issue is not with comprises six members, but we new era of cooperation in the version of the World Oil steady and lasting economic Saudi Energy Minister Khalid the producing countries, it’s are legally authorized to attend international oil industry’,” he publication, and I invite all growth across consuming and al-Falih“I do not told influence reporters prices,” as OPEC its meetings and of course we added. “Today we are holding ofedition you to of attend this flagship this special producing countries,” Barkindo and non-OPEC energy ministers the 10th Meeting of the JMMC, a occasion,” he added. said. “From the beginning, gathered in Algiers for a havewith thenot refiners,seen demand it’s with for theany we attended the meetings in a major milestone, and let us not “It is noteworthy that, over the OPEC Member Countries meeting that ended with no additionaldemand. We barrel in Saudi that Arabiawe did bidhave to no counter right to possible vote. However, action forget the 10th anniversary of have endeavored to meet formal recommendation for any not produce.” 40 years, our World Oil Outlook 41 Analyses September 2018 Issue No. 75 monthly Analyses

Shuaib Bahman oil market leader. That is why the International up for part of production falloff in aging oil fields may be negative and drive prices up significantly. Energy Agency (IEA) has released unrealistic and to relieve pressure on such fields. Oil production Therefore, tapping strategic oil reserves to supply he US withdrawal from Iran’s 2015 nuclear exaggerated predictions about Saudi oil output on hike by Saudi Arabia for politically motivated more is intertwined with its special complications deal with six world powers and Washington’s many occasions. Saudi Arabia has for years ranked reasons under different circumstances has seriously and therefore these reserves may not be simply used Tattempts to cut Iran’s oil exports to zero have the first in the world in terms of crude oil reserves harmed oil output in this country, causing a slump for regulating oil markets. Aside from the aforesaid raised serious questions about the future of energy and production capacity; however, realistic forecasts in oil production rate while increasing oil water. challenges, even if the idea of increased output market and possible fluctuations and shocks in the call into question data presented about the Arab Therefore, any future attempt by Saudi Arabia to works properly and oil prices decline Saudi Arabia oil market. Well mindful of the consequences of this nation’s crude oil reserves. In its Changing Wealth enhance output would be costly for Riyadh, which would then face a big challenge because it would see policy, the US government recently announced it of Nations 2018 report, the World Bank has said would even inflict more harm on its petroleum its petrodollars, which make up more than 70% of its would tap its Strategic Petroleum Reserves (SPR) that Saudi Arabia would have oil for 80 more years, industry. Saudi Arabia has only 200,000 b/d of extra economy, fall to very low levels. That would definitely to compensate for shortages in the market once which is far less than the survival rate given for capacity. threaten attempts by Crown Prince Mohammad sanctions against Iran’s petroleum sector have Iran, Venezuela, Libya, Canada, Iraq, Kuwait and bin Salman who has embarked on reforms to boost Influencing Prices snapped back into place. The Trump administration the United Arab Emirates (UAE). Saudi officials are his popularity prior to ascension to the throne. has left no stones unturned and ratcheted up the undoubtedly well aware of their genuine data about Saudi Arabia is also facing restrictions when it Therefore, the Saudi regime is not much willing to pressure on OPEC member states in a bid to win oil reserves. They cannot simply jump into the fray comes to dipping into its strategic oil reserves to see oil prices fall in the status quo. In the meantime, them over in its anti-Iran oil policy. Traditionally and supply more oil to reduce their own reserves. keep the market under control. It must be always another important point is that any increase in oil close ally of the US, Saudi Arabia is counted on by In fact, the Saudis’ long-term policy of political and kept in mind that any increase or decrease in production and exports by Saudi Arabia would be President Trump for maintaining oil market balance. economic exploitation of oil would pose a serious strategic petroleum reserves would significantly in contradiction with agreements reached within Due to political hostilities, Saudi Arabia has every obstacle to their unbridled use of oil resources. change the price of this product. As soon as there the Organization of the Petroleum Exporting reason to be on the US side in its anti-Iran campaign; Over recent years Saudi Arabia has sought to apply is talk of supply of strategic oil reserves on the Countries (OPEC). Saudi Arabia was among leading however, Saudi is faced with numerous restrictions cutting edge technology in order to develop its newly market, prices go into fluctuation. In other words, OPEC members to bring up the idea of oil freeze in and challenges for oil production and exports. discovered oil fields and maintain its production the psychological impacts of the supply of such a bid to help boost prices following the 2014 crash. levels. But in practice, despite the large number of reserves on the market are more significant than Therefore, any attempt by Saudi Arabia to release Challenges & Restrictions oil fields, such challenges as production falloff and its real impacts. The higher the level of strategic oil from its strategic reserves would draw negative In case the US manages to reduce Iran’s oil exports large quantities of oil water are threatening the oil reserves the lower oil prices will be. Therefore, reaction from fellow OPEC members and even non- to zero, other oil producers will have to supply 2.7 country’s future crude oil production. Currently, once the volume of strategic oil reserves declines, oil OPEC countries participating in the “Declaration of mb/d of oil on a sustainable basis. Saudi Arabia has rarely can a Saudi oil field be found to have been prices would go up. It means that in countries like Cooperation” in favor of prices. Saudi Arabia is facing welcomed the US decision, but the fact is that Riyadh exposed to vertical drilling. Furthermore, oil fields Saudi Arabia, where strategic oil reserves largely a sensitive choice; either it will cooperate with fellow is facing a variety of restrictions and challenges in that have been developed since the 2000s onward, contribute to energy pricing, any decline in OPEC members and non-OPEC producers or it will that regard. Since Saudi energy policies have always have managed only to make the strategic reserves would give rise to a join US unilateral sanctions on Iran. In the latter case, appeased the US and Western governments, most negative atmosphere which would finally oil production by Riyadh will face tough restrictions. energy centers have been boost prices. Releasing the strategic reserves widely covering Saudi Arabia’s into the market may boost oil supply; claims in a bid to introduce it however, the impact of rainy day reserves as OPEC’s kingpin and world

Saudi Arabia and Extra Oil Output; Challenges & Restrictions 42 43 Market September 2018 Issue No. 75 monthly Market

Global oil and Asian product market, September Mahdi Moeini disappointing in the short term, the expectation Are well underway, with demand elsewhere Fuel Oil is strong uptick of 200,000 b/d y-o-y in 2019 on remaining firm. Tightening balances over Q4 The collapse in HSFO cracks originated in he market’s need to adjust to the squeeze the back of close to 1 million b/d of additional should help relief some of the pressure on West Singapore before spreading to the West of Suez. on Iranian exports, which has become capacity coming online over the course of this of Suez cracks. Middle Distillates (gasoil, jet fuel) The fall came about from a confluence of factors, Tvery visible in the last few weeks, will and next year. Gas oil/diesel cracks east of Suez were range notably: 1) a lengthening of 400,000 b/d in remain a short-term focus. The cycle into over the reporting month, but similar to their the Middle Eastern fuel oil balance between autumn maintenance has so far not been too Asian Product Markets counterparts in the West, continue to be well June and October; 2) a strong uptick in arrivals pronounced in crude and the overall tightness Light Distillates (gasoline, naphtha) supported overall. Customs data out of Vietnam from West of Suez; 3) the loss of powergen in the balance should provide a solid base to Atlantic Basin naphtha cracks have come down has confirmed that the Nghi Son refinery neared demand from Pakistan; and 4) a still open NWE/ pricing even if more softening becomes apparent in line with a weakening gasoline complex commercial production over July-August, with Singapore arb spread, indicating that arrivals in demand. Russian crude and condensate Post peak demand season. We see relatively imports of diesel dropping by close to 40% y-o-y, from the West should remain elevated even output could top October 2016 levels in Q4 as low chances of a reversal over the near term, providing some pressure on the wider market. after peak demand. These factors trounced companies ramp up production of newer fields. keeping naphtha firmly pressured. Additionally, Turnarounds and seasonally rising demand the main supportive factor, which came from Condensate production should also increase steam cracking margins, while remaining overall should provide a firm floor for cracks going Iran. Iranian fuel oil availability has already together with natural gas ahead of the winter healthy, have shown signs of weakening, meaning forward. tight-ened in September on the back of refinery months. After a couple of months of relatively players may not run as high as they did over the Asian jet regrades remained firmly in negative maintenance that lasted the whole of August at lower readings on implied Chinese stock builds past few years. We could be looking at a return of territory on a barrel basis over the reporting the Iranian Bandar Abbas plant, while interest for crude in line with slightly softening refinery naphtha demand in the Americas, where rising month, with cracks nevertheless performing in volumes loading beyond September is likely intake. This will be driven at least by higher ethane prices and strong aromatics prices may well. Seasonally lengthening balances in to be very low given the resumption of US intake, which we expect to grow strongly y-o-y, pull naphtha cracking capacity back into the Europe are likely to weigh somewhat on the sanctions on Iranian oil exports in November. Hosseini Hassan Photo: and potentially by additional buying for stocks market. Asian naphtha cracks have remained attractiveness of arb movements, and unless As in the West of Suez, the expectation is fuel as well, which could effectively tighten the Q4 relatively better supported, with overall lower Japan faces another strong winter, we would oil cracks to stabilize a little over the next two balance even further. pressure apparent on the light ends East of Expect regrades to refrain from spiking to the months before continuing their decline in line While Brazilian crude output looks Suez. Seasonal turnarounds scheduled for H2 levels seen last year over this winter. with IMO 2020 pressures. 44 45 More Gas Find Beneath UK Shetland ProductionIPF Total has confirmed that its Glendronach a good-quality (Lower Cretaceous) Petrobras Gains Extension exploration well west of Shetland in UK reservoir, permeability and production Offshore Brazil waters has discovered gas. The well was deliverability, with recoverable resources drilled in around 300 m (984 ft) water estimated at around 1 tcf. Total believes Petrobras has awarded the Transocean depth on block 206/04a, to a final depth the find could be developed quickly with ultra-deepwater drillship Petrobras of 4,312 m (14,147 ft), in a formation the existing infrastructure around the 10000 a 790-day contract extension below the producing Edradour reservoir. Edradour field and the Laggan-Tormore offshore Brazil.The contract is extended It encountered 42 m (138 ft) of net pay pipeline system, which is connected to through October 2021 and includes a of gas. Initial analysis has confirmed the Shetland Gas Plant. blend and extend modification to the previous contract day rate, effective September 2018. The additional net contract backlog is about $185 million, including cost escalations.Additionally, Transocean will receive a 5% royalty per day, totaling approximately $16 million, Namibia Clears Eco, estimated to be from October 2018 to October 2021 associated with the use in Partners for Offshore Well Brazil of the company’s patented dual- Eco (Atlantic) Oil & Gas has received activity technology on the Petrobras an environmental clearance certificate from 10000. Namibia’s Ministry of Environment and Tourism for an exploration well on the Osprey prospect. UK Commercial Gas The structure is in the ‘Cooper’ (PEL 30) block in Confirmed in Myanmar the offshore Walvis basin. Eco has completed seven Total has participated in a successful years of studies on the block, including regional appraisal well on the Shwe Yee Htun- geological and fracture analysis, a slick review, 2 gas discovery in the A2 block offshore and assessment of 2D and 3D seismic. It also Myanmar. contracted independent studies from The well, drilled to a final depth of 4,820 Petroleum Geo-Services, Azinam, m (15,814 ft), intersected 40 m (131 ft) of Tullow Oil, and Gustavson net gas pay. Early analysis has confirmed Associates. good reservoir quality, permeability, and production deliverability. It follows the Myanmar Shwe Yee Htun-1 and Pyi Thit-1 gas finds on the same block in 2016-17. Total VIEW estimates combined resources in the range of 2-3 tcf. Ghana Brazil

Oil Find in Western Australia Wood Mackenzie has issued some thoughts on Quadrant Energy’s VIEW VIEW recent Dorado oil discovery in the Australia Bedout basin offshore Western Australia. Australasia upstream senior analyst Daniel Toleman said that sometimes, exploration throws up a result that no one saw coming. Prior to drilling, both WoodMac and Quadrant had viewed the Dorado-1 well as one of the top gas wildcats to watch in the region in 2018. The aim had been to find 545 bcf of gas, but the actual outcome appears to be a large commercial oil find. news September 2018 Issue No. 75 monthly news Mexico President to Honor Existing Oil Contracts U.S. Oil Drillers Add Fewest Rigs Mexico’s president-elect, U.S. energy companies cut oil Andres Manuel Lopez Obrador, rigs for a second consecutive assured private energy week as new drilling stalled executives in a closed-door in the third quarter with the meeting their contracts will not fewest additions in a quarter be canceled if they meet existing since 2017 due to pipeline terms, the head of the country’s constraints in the nation’s main oil producers’ association said. Lopez Obrador, who has three oil rigs in the week to often expressed skepticism of Sept.largest 28, oil bringing field. Drillers the total cut private sector involvement in Mexico’s oil industry, met for count down to 863, General executives, striking what was closelyElectric followed Co’s Baker report. Hughes describedthe first time as awith diplomatic oil and gastone energyFor the services third quarter, firm said the in its with them. “The president-elect told us on various occasions the smallest since drillers cut that they will respect contracts threeincrease rigs of in five the oil fourth rigs wasquarter so long as we obviously comply of 2017. They added 50 rigs in with all of the contracts’ commitments,” said Alberto de 1 the second quarter of 2018. la Fuente, president of Mexico’s December, Lopez Obrador did said the Lopez theFor first the monthquarter of and September, 61 rigs in The rig count has held mostly pace of those additions 2 not speak to reporters following Obrador administration also meanwhile, the oil rig count steady since June as spot crude has slowed each quarter following the meeting with the closed-door event. But his will help companies deal with was up one, the same rise as prices in the Permian region AMEXHI producers’ group, designated energy minister, any regulatory delays they face. in August. The U.S. rig count, in western Texas and eastern at ease that our contracts will be an early indicator of future this year to just 13 added in honored,”Lopez Obrador. added “We De la left Fuente, feeling incoming administration’s we will talk to the regulators, or output, is higher than a year have collapsed due to a lack of the third quarter from 31 in who also is head of Anglo-Dutch Rocio Nahle, confirmed the more“We made to the a pointcommitment that we thatwill ago when 750 rigs were active pipelineNew Mexico infrastructure WTM- WTC-WTM needed the Permiansecond quarter is forecast and to44 rise in oil major Royal Dutch Shell in will respect the rule of law review the regulators because as energy companies have to transport more fuel out the first quarter. Production in Mexico. Set to become Mexico’s andsupport the agreementsfor the contracts. that have “We there is a constant complaint been ramping up production in of the region. On a quarterly in October, just below output been made with the outgoing that they take too much time,” anticipation of higher prices in basis, drillers in the Permian fromto 3.5 Iran, million OPEC’s barrels third per largest day government,” Nahle said. She said Nahle. 2018 than previous years. are still adding rigs, but the producer. first leftist president in modern historyNEWS when he takes office in NEWS NEWS NEWS Croatia Extends Deadline Wintershall, DEA to Consortium to Pay Rosneft U.S. Crude Output Hits LNG Terminal Project Create Oil/Gas Business $230mn to Settle Row Record 10.96mb/d Croatia has again extended a deadline for Chemicals group BASF and LetterOne signed a Russia’s Sakhalin-1 consortium, led by ExxonMobil, submitting binding bids for the use of a planned merger agreement to combine their respective has agreed to pay Russian energy giant Rosneft millionU.S. crude bpd oil in productionJuly, led by recordrose 269,000 output northern Adriatic. “The deadline has been moved create an independent European oil and gas oil production dispute, an executive of an Indian frombarrels Texas per andday North(bpd) toDakota, a record the 10.964 U.S. fromfloating Sept. liquefied 28 to Dec. natural 20 this gas year,” (LNG) state-owned terminal in the company,oil and gas the businesses companies Wintershall said. and DEA to $230 million in an out-of-court settlement of an Energy Information Administration said in a LNG Croatia said in a statement on its website. The billion lawsuit in the Sakhalin district arbitration monthly report. decision was taken after a request from potential courtconsortium in Russia’s partner far east,said. accusingRosneft had the filedconsortium a $1.4 willThe seek new tocompany list itself called through Wintershall an initial DEA public will of unjust enrichment, an allegation the consortium extended in early August was for the same reason. offering,be headquartered BASF said. in Kassel and Hamburg and denied. The dispute centred around how oil should U.S.The crudeagency production revised its Junehas surgedproduction thanks figure to Thebidders, terminal it added. on the The northern first time Adriatic the deadline island wasof Krk Under the deal, LetterOne will put all its shares be shared between the Sakhalin-1 concession and an aslightly shale boomhigher and to 10.695 now rivals million top bpd producers in June. is planned as part of the European Union’s efforts to in a vehicle of Russian billionaire Mikhail Russia and Saudi Arabia. Oil production in diversify from Russian energy imports. The targeted markets are countries in central and southeastern against the issuance of new shares of the adjacent Rosneft field.“Rosneft was demanding that Sept. 1 and Sept. 27 and was on track to Europe. The value of the terminal is seen at 250 companyFridman’s to DEA LetterOne. into Wintershall Holding GmbH millionit should as be Rosneft paid $1.4 entered billion the ... otherWe have area agreed for reachRussia another averaged post-Soviet 11.347 million high, anbpd energy between BASF will initially hold 67 percent and inan 2011,” out-of-court N.K. Verma, settlement managing and will director be paying $230 sector source told Reuters. Saudi Arabia of India’s ONGC Videsh, a partner in the 5 million euros.euros ($291.63 million) with the 3 DEA’s ordinary shares. 4 Sakhalin-1 consortium, told Reuters. bpd in August. 6 European Union financing just over 120 LetterOne 33 percent of Wintershall meanwhile, produced about 10.4 million 48 49 news September 2018 Issue No. 75 monthly news Malaysia Oil Firm to Double Production Total Sees Output Boost From Deepwater Projects Malaysian oil and gas Oil and gas major Total said it exploration and production expected deepwater oil and gas operations to make a strong aiming to double its oil output contribution to its output and incompany the United Hibiscus Kingdom Petroleum and is Malaysia to 20,000 barrels per day (bpd) by 2021, a senior Gulfcash offlow Guinea thanks region, to major Brazil and company executive said. U.S.developments Gulf area. Production in the West from Africa’s It needs an additional $50 deepwater projects is expected million by 2020 to boost to reach 500,000 barrels of oil production from about 10,000 equivalent per day (Kboe/d) by bpd now, Kenneth Pereira, 2020, contributing to its 6 to 7 managing director of the percent output growth target company, told reporters. per year from 2017 to 2020. “That’s our maximum negative “Deepwater is today for us a

part of the portfolio,” Total’s $60cashflow per barrel for projects oil scenario,” already he Presidentgrowing and for veryExploration profitable and said.identified “So at and $70 that’s per barrel based oil, on a Production Arnaud Breuillac, told investors in New York. Deepwater million.” The company, which production will increase to more 8 developsit will be somethingsmall oil and like gas $40 Nasional Bhd (PNB), 7 than half a million barrels of Total’s deepwater projects on the expects talks to oil per day by 2020 with cash in Brazil’s “pre-salt” or deep producing assets. One is the has anot 10-year produced marketing first oil and acquire commercial assets Nord in Congo, Kaombo North in offshoresignificant projects, projects including in pipeline Anasuriafields in Asia, Cluster has intwo the major North offtakeyet, Pereira agreement said. Hibiscus with BP Oil within London’s Battersea AngolaWest African which coast began includes production Moho Lapa, Libra and Lara projects Sea in the United Kingdom. International to sell crude from Power Station to complete in the $60flow per from barrel, operations Breuillac at over said. in July. Production is expected to which could add around 100 The other is in Malaysia, the the North Sea, and a three- fourth quarter of this year, its “Deepwater$30 per barrel is approximatelyat an oil price of 15 kboe/d by 2022. In the Gulf of 2011 North Sabah production year agreement to sell crude CEO said. The ongoing talks are percent of the group’s production by the end of the year, and at Mexico, the Ballymore giant sharing contract (PSC), which “positive” and the fund may seek but it will contribute to more Kaombostart at its South Nigeria’s by the Egina summer field of discovery is being appraised, includes the Labuan crude another extension to continue while production and more oil terminal. It also owns a fromMalaysia’s the Malaysian largest asset oil field to the discussions, PNB CEO Abdul operations in the coming years,” Breuillac said the French developments were ongoing at its discovery in Australia that commodity trader Trafigura. Rahman Ahmad said. hethan said 35 during percent a ofpresentation. cash flow from company2019. had a number of Jack and Tahiti operations.

NEWS management firm, Permodalan NEWS Saudi Aramco to Produce More in Q4 Shell to Handle Contract US Refinery Talks State oil giant Saudi Aramco with the matter said. The Royal Dutch Shell Plc said Shell’s statement was similar will bring new crude output resumption of production to boost supplies and reach it looks forward to handling near-full utilization rates and to that made by the head of the capacity of some 550,000 from the giant Manifa field, highercompany production more flexibility levels industry negotiations on a recordhas enjoyed product strong exports. profits, In barrels per day (bpd) online which pumps heavy sour sooner than before. national contract covering the June quarter, the margin The union is aiming for a in the fourth quarter from oil, after resolving some Saudi Arabia currently pumps on turning crude to gasoline, three-yearUSW’s oil bargaining contract with program. wage two fields - Khurais and maintenance issues will around 10.5 million bpd and chemical plant workers diesel and other products was increases of about 6 percent Manifa - giving it the ability will quietly add extra oil to the represented30,000 U.S. refinery by the United and the highest since 2015. per year. to boost production if there to Aramco’s crude output market over the next couple “Our goal in the bargaining “Our goal is a mutually is demand, a source said. capacity,add another the 300,000source said. bpd of months to offset a drop in The talks begin formally in process will be to reach The expansion of crude Saudi Arabia, the world’s Iranian production. JanuarySteelworkers and Shell, union which (USW). has an agreement with the members and the companies output capacity from Khurais largest oil exporter, is the Saudi Energy Minister Khalid represented its peers since theybeneficial work agreementfor,” Kim Nibarger, for our field, which produces only major producer with oil al-Falih said production our employees continue to chairman of the union’s light sour crude, will add output capacity of about 12 from Manifa would return behalf of companies including receiveUSW which competitive ensures paythat and national oil bargaining around 250,000- million bpd. The additional 1997, is leadBP, negotiator Chevron Corp, on benefits while keeping the program, said in an interview. output increase will not raise a pipeline issue has been Exxon Mobil Corp industry competitive in the Union members with four day boosting the field Aramco’s capacity above the resolvedto 900,000 which bpd hassoon caused after and others. global marketplace,” Shell years’ experience currently 9 potential300,000 barrels to 1.5 million per current 12 million bpd. 10 spokesman Ray Fisher said in bpd, one source familiar But that would give the over the past months. industry this year a statement. Nibarger said. output decline from the field The refining earn about $40 an hour, 50 51 Perspective September 2018 Issue No. 75 monthly Perspective

document, as it is used by government the new safety rules, before nuclear beginning departments and industry, to guide investments to restart, operators must meet new regulatory in the energy sector of the country. The plan safety standards, as well as getting approval Japan: 2030 National Energy is driven by safety and the ‘Three Es’: Energy from local Japanese governments. According to the GECF projections, these factors will

security, Economic efficiency, and Environment. renewables will play in Japan’s energy mix. Plan and Gas Demand The 2030 NEP aims to increase domestic energy contribute to the significant role that LNG and Japan is one of the top five developed economies in the world, and its self-sufficiency to 24% by 2030, compared with according to the plan LNG imports will fall from advanced industries and large population require a vast amount of energy. levels.8% in 2016,According and toto trimthe plan, emissions gas and by coal 26% share by However, if the 2030 NEP is borne out by reality, Significantly, this island on the shore of the Pacific Ocean does not hold fossil will2030, return and 80% to the by pre-Fukushima 2050, compared levels, to 2013 oil fuels reserves, in particular, natural gas. Historically, Japan has not been self-sufficient will drastically reduce, and nuclear energy will 80.7 MN MT per year in 2017 to 62-64MN MT recover. ofper gas year in theby 2030, Japanese and electricitywill keep the generation same levels mix in terms of energy needs, depending heavily on imports of fossil fuels. by 2040. Hence, as mentioned above the share mix will be supplied by renewable energies On the other hand, due to the energy security Hussein Moghaddam sectors were accelerated to overcome the It is expected, 22–24% of the power generation will drop to about 27% in 2030.

ollowing the Fukushima disaster in 2011, implementation of the Revised Gas Business which(8.8–9.2% is a majorhydropower, shift in 7%government solar, 3.7–4.6% policy, issues, coal will be producing 26% of Japan’s Japan became increasingly dependent Actdisconnectedness in 2017, the formerly of the networks. regulated Withgas sector the biomass, 1.7% wind, and 1–1.1% geothermal), Duringpower bythe 2030, last two close years the pre-FukushimaJapan opened eight levels, Fon fossil fuels, and imports boosted became competitive. Because the Japanese but lower than the 33% that seen in 2017. reliance on coal and LNG. For instance, in the government aims to facilitate access to the 20–22% will be supplied by nuclear energy, three years following the Fukushima disaster, LNG supply chain, from import terminals to countryand 56% intends will be tosupplied cut the byshare fossil of fuelsfossil (26% fuels new coal-fired power plants, and also aims to Japan spent an additional annual average of distribution to end users, LNG markets were coal, 27% LNG, and 3% oil). Furthermore, the Actuallyopen another these 36 can coal-fired supply more plants electricity in the next 10 also affected. Japanese energy companies years (about 8 GW between 2015 and 2030). government chose LNG to substitute for lost depend on the spot market to meet their in its energy mix to 76% by 2030, down from probably will, if nuclear fails to meet the NEP nuclearabout $30 generation.So billion, on fossil far, in fuel Japan imports. eight nuclearThe domestic obligations, and for that reason prefer NEP92% targets,currently. shows Comparison a marked of shift pre- from and post-fossil than the 26% designated in the NEP 2030, and reactors have come back into operation, and fuelsFukushima to renewables power generation and hydro mix development. with the 2030 To sum up, according to the GECF forecasts gas three reactors have had their operating lifetimes Although the government’s policy is still 2030 target. moreJapan flexible 2030 gasNational contracts. Energy Plan (NEP) strongly supportive of nuclear restarts, public All three reactors were due to be assessed Last July, Japan’s ministry for the economy, opposition still remains. demand in Japan energy mix declines from 23% formally extended from 40 to 60 years. trade and industry (METI), published a new Restarts to date have been far slower than electricityin 2017 to demand19% in 2040 and lower (from gas 125 consumption bcm to about but it will be harder for the remaining plants version of the “Basic Energy Plan”, called expected, and all reactors have faced legal in91 the bcm, power accordingly). generation This sector. is attributed Gas demand to flat towhen be granted their original the same 40-year extensions. licenses As expired, a result, “National Energy Plan” (NEP). This is the challenges from local residents. The nuclear will be hampered by reinstated nuclear power Japan will fall short of its nuclear targets, and target is ambitious and can only be realized if capacity, coupled with aggressive renewables the difference will be compensated by higher after approval by the Japanese cabinet, and publiccountry’s consulting. fifth energy In Japan, plan, theand government it was published is nearly all nuclear plants are granted permission to come back online under the stricter National Energy Plan (NEP). about Japan is that the infrastructure and gas required by law to re-evaluate and publish a post-Fukushima regulations, and if their deployment designated by the new 2030 transportationcoal and gas-fired systems generation. belong The to private other point energy revised energy plan at least every three years. The last time the national lifetimes are extended beyond the resulted in poorly connected gas transportation energy plan was revised and companies, and insufficient investments have systems. This created some serious problems, standard 40 years. According to especially after Fukushima nuclear power evaluated in 2014. The accident. The country faced energy shortages important 2030 NEP is an at a time when oil and LNG prices were particularly high. The natural gas market was liberalised and, as a result, the electricity and heating

52 53 History September 2018 Issue No. 75 monthly History Iran Oil and Two World Wars arely had two years passed 25,000 tonnes a month of oil since the construction and petroleum products was B being exported from Abadan. Iranian city of Abadan when That amount was so important of an oil refinery in the for Britain’s Marines to urge documents revealed that a major the British government to take objectiveWorld War pursued I broke in out. the Later bloody on, action. British forces were deployed in Basra while Indian and gas resources all across the soldiers were deployed in globe.conflict was dominance on oil Khuzestan. The Indians’ presence The Triple Entente treaty was in Khuzestan produced cultural reached among Britain, France and social impacts in addition to and Russia on how to divide military issues. Khuzestan was global oil resources after the dotted with military barracks end of the war. French politician and camps which housed Indian Georges Clemenceau had said troops. Such titles as “Sahib” that one drop of oil would be became common in those areas. equal in value with one drop of In different areas of Khuzestan, blood. British politician Lord including Masjed Soleyman, the between Iran and AIOC, which extraction and distribution of George Nathaniel Curzon had Indians were housed. The Allied resulted in the revision of terms were among important events Middle East oil in the post-war predicted that the Allies would go forces’ dependence on oil and of the D’Arcy Concession and the whichConcession happened and the between 1933 Treaty the itrefinery. became The clear factory that it started would not era. Roosevelt and Churchill through oil to reach victory. two global wars. The world was supplywork in enough 1940, but gasoline two years for the later opposed, saying the issue had The involvement of Turkey’s for them led to the expansion of In the years following the war, bracing for new events which warring Allied forces. Therefore, to be discussed later on. In fact, Ottoman Empire in the global the significance of oil facilities activitiessignature wereof the developing. 1919 Agreement. In during the war new sections Russia was seeking to plunder war posed a serious threat to Middle East oil, particularly the Anglo-Iranian Oil Company pavedAIOC activities road was in built Iran connecting from 1915 had brought its annual treatment would not spare Iran. When Iran’s oil after the war. As soon Masjedto 1919. Soleyman In the In theto Darkhazineh. meantime, a capacitylate 1992, to the three Abadan million refinery tonnes. inWWII international broke out, relations Iran’s oil for proved a towere produce added one to the million refinery tonnes until as the war ended, the Americans New transportation means like secondits significance time. The and invasion influence of ain year 1944 of the jet refineryfuel, which was was able a also eyed Iran’s oil. Sinclair Britain(AIOC). andWhen the in Ottomans, November it was passenger cars and truck were built to connect Darkhazineh Iran by the British forces and record in the world. Oil Corporation and Standard announced1914 a war thaterupted Iran’s between oil facilities used. Masjed Soleyman’s power andIn 1924, Masjed a small Soleyman. railway That was From the second year of the Vacuum Oil Company came to would be within the reach of the generation plant was developed helped circumvent mountainous destabilized Iran. war it became known that Iran in the hope of winning oil and the capacity of the Abadan areas. New exploration work theirThe mainallies objectivein September sought 1941 Iran had to supply petroleum concessions. by the Allied forces in their products to the Allies. The downfall of Reza Shah Turks. German Consul Wilhelm construction of a new pipeline. oil reserves were discovered invasion of Iran was to deliver Therefore, development of and the transition of power to Wassmuss, who was based in refineryOil extraction was enhanced and export with rose the was under way. In 1928, huge ammunitions to Russia; however, AIOC was restarted. The British his son were important events goodBushehr, information had already about identified the one million tonnes of oil was it may not be denied that the and American governments during that period of Iran’s extensionoil-rich zones of Masjed in Iran. Soleyman- He had extractedin Haftkal. from In 1930 that only, area. about In the Allies were concerned with decided to send necessary history, which resulted in more Abadan oil pipeline. Moreover, from 274,000 tonnes a year in safeguarding Iran’s petroleum equipment to Iran. That marked events in Iran’s interaction he had once met with the head of as1914 a bridge to 1.385 to victory. million Britaintonnes andin industry. The conditions changed the start of the US’s silent with AIOC. Development of Masjed Soleyman. On February its1920. allies Iran’s did oilspare flow no was efforts serving to same year, the Abadan refinery’s drastically after Japan intervened presence in global politics and oil industry in Iran continued protect this valuable source of treatment capacity reached five in the war because the Japanese economy, which resulted in new local tribesmen to explode energy. transpiredmillion tonnes. Iran. From The transition WWI to managed to free Indonesia and conditions for the entire world. the6, 1915, pipeline. Wassmuss AIOC stores incited were The end of the war resulted in ofWWII, power important from the political Qajar to events the Burma, which were both major Extraction from new reservoirs tonnesafter the of war. oil, whichIn 1946, increased Iran plundered and communications the development of petroleum Pahlavi dynasty and the new resources of hydrocarbon for including in Aghajari started to was recovering 19.19 million lines were cut. That might be industry in Iran. AIOC recorded Shah’s efforts for empowering the Allies. Then, Iran became provide kerosene to the Allies. The reason for such increase the most important and the only progress to the extent that its the central government forced the unique source of revenue for into oil31 productionmillion tonnes resulted in 1950. from Board of Directors managed to the company’s administrators to the Allies. Not long before the conference in Tehran between new operations in Gachsaran, from the fact that the country sell three million bills printed resort to government forces in JosephDuring Stalin,the November Franklin 1943 Roosevelt satWWI-era atop huge even oil in reserves.Iran to result At for the company’s assets. At the order to protect their interests. had been built to produce jet Ahvaz and other oil-rich The termination of the D’Arcy fuelbreakout was installed of WWII, at a thefacility Abadan that proposed negotiations about the regions.Aghajari, Omidieh, Lali, Haftkal, and Winston Churchill, Stalin 54 the beginning of WWI, roughly same time, conflicts emerged 55 Sports September 2018 Issue No. 75 monthly Sports

Portuguese trainers have always enjoyed a high standing in Iran. Carlos Queiroz is a case in point as he managed to lead Iran’s national soccer team to the World Cup matches and prove a good performance. Another Portuguese Football is football coach currently working in Iran is well-known Paulo Sérgio Bento Brito, who is currently training Sanat Naft Abadan football team. an emotional sport. Today, football is not limited to a sport discipline. Portugal for family visit everyone told me I had put Many, in Iran, say defensive style is not a In many parts good method for Iran’s football team. Paulo Sérgio Bento Brito: love it so much. It does not agree with my body, but of the world Now I ask you a question. Did you know any other Ion really weight! love I itslove taste. a food made with fish in Abadan. I football has turned into a Cup matches? I don’t think so. In my view, if you acceptbetter methodQueiroz toas face the headPortugal coach and of Spain Iran’s in national World stimulant and I’m Enjoying So you are enjoying yourself in Abadan, football team you need to respect his ideas and aren’t you? that is why you style. enjoy watching Your country is excellent. I had a white drink, Iranian known as yoghurt drink, in Isfahan. It was delicious. Paulo different styles and supporting Sérgio may not have Aside from that, you are living very tough days at Sanat Naft. Some fans are not happy had in Isfahan had a different taste. Iran is really Sérgio different teams yet become popular enough We have such drinks in Portugal, but the one I Football, with your performance. Is that true? beautiful and I now understand why Queiroz has among football fans; however, his Football coaches across the globe try their best to stayed here seven years now. [Laughing] ideas could definitely push Sanat Naft satisfy their fans. I am doing my job and I am trying I know Abadan to a high position if they are Culture and to do it in the best possible manner. All our efforts How long do you think you will stay in “Salam! turned into practice. Sanat Naft Abadan is are focused on satisfying football fans. I feel happy Iran? Khoubi?” (Hi, a leading soccer team in Khuzestan Province. to see that our clubs are packed in all matches. I don’t know. You’ve to ask Sanat Naft managers. how are you?). Food The following is an exclusive interview with That is the beauty of football. In the meantime, I follow their rules. But I will enjoy everything I’m doing my I understand that football fans always want to Amir Sadeqi-Panah as long as I’m here. I enjoy football, foodstuff job and I hope Paulo Sérgio Bento Brito: see their desired team emerge winner. But how and culture of your country. Even after I go I to do my best. long have I been in Iran now? I have been in your will relate good memories of Iran to my family. In your home country, you are credited How is your relation with Queiroz? country for less than three months. Did I choose I am striving to Queiroz is a great coach and I feel pride to see Let me tell you a story: One day in Lisbon, I ran with lots of honors. How come you accepted to these players for Sanat Naft? I agreed to work with make football my countryman being such successful. I have across Tony Oliveira. You must know him because come and train an Iranian team? them. Ok! But I need more time to arrange affairs fans and club As a matter of fact, in addition to Portuguese no problem with Queiroz and I am happy to see he worked for Tractor Sazi. Tony had become and execute my tactics. Before coming here, I did managers teams, Chinese and Uzbek teams had also offered very popular in Tabriz and all fans of Tractor Sazi not even know your culture. Now my conditions happy. I have me coach jobs. But I always like to experience new Cup performance stunned everyone and that loved him. After going back to Portugal, he said have improved. I have even learnt a bit Persian. challenges. That is why when I received the offer washim traininglargely owing Iran’s tonational Queiroz’s team. performance. Iran’s World he liked to return to Iran and die there! I hope he nothing else in from Sanat Naft, I consulted some of my friends I hope that he can lead Iran’s nation to Asian would live long years. But we, as foreign coaches, mind you?). I’m doing my job and I hope to do my best. I and decided to travel to Iran. Championship title. really enjoy working in Iran. Everything goes amFor strivinginstance, to I makeknow football“Salam! fansKhoubi?” and club (Hi, how are ahead smoothly. managers happy. I have nothing else in mind. Don’t you regret your choice now? But you think differently from Queiroz when In Abadan, we have still many shortages and it comes to football. Your team does not follow the Do you make any promise to we may not do our job as we desire; however, I national team’s defensive style, does it? supporters of Sanat Naft Abadan? You said Iranian food. am happy with the current conditions. I’ve come Each coach has his own methodology. For me, I can’t make any promise, but I will Are you happy with Iranian here to work; anyone who wants to work has to coaching is a style and each coach has his own try my best to push the team’s food? style. You cannot expect two coaches to train their ranking up. That is my main Sure! Iranian food is excellent. objective. I love kebab. I had eaten kebab overcome difficulties. would play identically and there was no pleasure so much that when I went to Did you talk to other Portuguese coaches ofplayers watching similarly. soccer. Were Football it such is anall emotionalfootball teams sport. like Carlos Queiroz and Nelo Vingada who have Today, football is not limited to a sport discipline. experienced working in Iran? In many parts of the world football has turned into a stimulant and that is why you enjoy watching spoke very highly of your country and I was really different styles and supporting different teams. encouragedI talked to Vingada to come and to Iran sought to get his familiar views. He with This diversity of styles makes you love football. I your culture and nation. I do really like Iran and I said all this so that you would no longer compare am happy with my presence here now. two football coaches and their styles. 56 57 Tourism September 2018 Issue No. 75 monthly Tourism

Ilam, Beauty of Zagros Ilam Province is located west of Zagros Siahgal Fire Temple Mountains. It neighbors Khuzestan Province to the south, Lorestan Province to the east, Siahgal Fire Temple is among ancient Kermanshah Province to the north and Iraq monuments in Ilam Province. It was built under to the west. The main cities in this province the Sassanid dynasty. It is situated 15 kilometers are Ivan, Dehloran, Mehran and Shirvan. southwest of Sartang village. The fire temple The provincial capital bears the same name as is among few pre-Islamic intact monuments. the province. Owing to its abundant natural Standing on four legs, it has a single-wall dome. attractions, Ilam which is surrounded by More than 1,700 years old now, the fire temple mountains and jungles is known as the beauty of is made of stone and sarooj (a water-resistant Zagros, and weather is mild in Ilam. mortar) used to burn up to the Safavid dynasty. In addition to natural attractions, Ilam Province is also home to historical monuments, some of which are briefly reviewed as follows:

58 59 Tourism September 2018 Issue No. 75 monthly Tourism

Gav-Mishan Bridge Gav-Mishan Bridge dates from the Sassanid era. It lies northeast of Darreshahr over Seymareh River. The bridge takes its appellation from Gav (cow) and Mish (sheep) as it used to a pasture. There are stories about the appellation of this bridge which has been restored throughout centuries.

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Seymareh City This historical city is located southwest of Darreshahr. It used to be named Madakto. Seymareh was built in the final years of the Sassanid era. The area of this city is more than 200 ha.

62 63 news September 2018 Issue No. 75 monthly news

Raziyaneh Ravine This ravine is known as a geo-tourism area in Ilam Province. This wide and deep ravine s located in a green area where a river is flowing. Seventy-five ha of land in this ravine was registered as national/ natural heritage in 2009 in Iran. It was registered by the International Union for Conservation of Nature (IUCN; officially International Union for Conservation of Nature and Natural Resources). IranPetroleum

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64 65 Ghelaghiran Mountain Ilam