National Iranian Gas Company Looking at Bigger LPG Markets

EghtesadOnline: Boosting liquefied petroleum gas export to international markets is a priority for the National Iranian Gas Company in 2019, the newly appointed head of the company said.

News ID: ۷۴۶۹۰۹

13 March 2019

"LPG output is on the rise as more phases of the South Pars Gas Field come on stream. It is time to expand our presence in overseas markets," Hassan Montazer-Torbati was quoted as saying by ILNA on Tuesday.

Iran annually produces 10 million tons of LPG and output is rising as South Pars phases 22-24 gradually become operation.

The official said last August LPG export reached 568,000 tons, according to Financial Tribune.

New US sanctions do not pose a major setback to Iran's share in the global LPG market, he added.

Iran currently accounts for 17% of LPG trade in the Middle East and this is expected to grow to 40% by 2020.

Iran exports LPG to clients in Asia, including China, Pakistan, Iraq and Turkey.

Iran and India are in talks over a long-term LPG supply deal to the South Asian country.

Data released by Argus, a leading provider of data on prices, analysis, and consultancy services for global crude and LPG, show Iran raised LPG exports to over 5.5 million tons in 2016, from 4.5 million tons in 2015. The country made strides into East Asian markets with the delivery of its first cargo to Indonesia in 2017.

LPG has a variety of uses -- commercial, industrial, transport and household – making it a globally attractive eco-friendly fuel. According to the International Energy Agency’s October 2018 Oil Market Report, demand for LPG and ethane was 12.5% of total daily oil products demand and totaled 12.4 million barrels per day in the first half of 2018, an increase of 4.1% over the first half of 2017.

LPG demand growth is running at about four times the total demand for oil products.

New Loading Pier

To increase exports, work is underway to build a loading pier for LPG at Tombak Port, 50km north of the port of Asalouyeh in southern Iran, an official at Pars Oil and Gas Company said.

"The pier is expected to become operational soon with the help of domestic contractors," Mohieddin Jafari said. It includes two LPG loading arms each of which can berth fuel carriers with a capacity of 50,000 tons.

The facility will also be equipped with a modern arm to load sulfur for vessels with capacities from 5 to 50,000 tons.

Pointing to other infrastructure projects, Jafari said construction of two sulfur warehouses plus a refining unit in South Pars phases 22-24 are on the agenda.

Tombak, with a depth of 34 meters, is the deepest port in the Persian Gulf.

South Pars is the world’s largest gas field shared between Iran and Qatar. Iran is developing the mega project in 24 phases. The field provides more than two-thirds of the national demand for natural gas.