LPG Demand 2m Tons p.a.

EghtesadOnline: Two million tons of liquefied petroleum gas is consumed annually in Iran, managing director of Persi Iran Gas Company said.

News ID: ۷۸۶۰۲۵

16 February 2021

“The company, which is the biggest LPG supplier, sells 66,500 tons of LPG per day across the country,” IRNA quoted Hamidreza Haddadi as saying.

Persi company was established in 2008 after the Iran Gas Company and Persi Gas Company merged and has about half the share of the domestic market, Haddadi said.

The company also sells LPG in Sistan-Baluchestan Province, south of Kerman and part of Hormozgan provinces, as well as rural and nomadic regions with no access to piped gas.

It has a robust transport fleet including 432 mega tankers (18-ton capacity), 62 super wagons (40 tons capacity each), 47 lorries (3-10 tons capacity), 3,000 trucks, pick-ups and other vehicles. It carries one million tons of LPG a year from refineries to target destinations.

“According to Oil Ministry programs, since the urban and rural gas distribution network is expanding, LPG consumption should annually decline by 5%,” Haddadi said, and noted that 76 companies are involved in the distribution of LPG in Iran.

“With the launch of the Persian Gulf Star Refinery [in southern Hormozgan Province], LPG production is expected to reach 20 million tons per annum by 2025.” A major part of it will be exported.

An estimated 20,000 tons of LPG is produced a day half of which is sold in regions that lack access to piped gas and the rest is exported.

Liquefied petroleum gas is a flammable mixture of hydrocarbon gases used as fuel for heating, cooking and in vehicles. There are two million households that are not yet linked to the national gas grid and need LPG for cooking and heating.

LPG is also used in vehicles, Haddadi said. “With the increase in the price of gasoline two years ago, consumption of LPG by car owners has increased as its price has not changed”.

Using LPG as fuel is better for the environment. This is because the combustion of LPG is more complete and efficient than gasoline, which means that the amount of carbon monoxide and hydrocarbons is much less.

However, as LPG cylinders are largely designed for cooking purposes, they are not suitable for vehicles. Moreover, as long as cars can run on compressed natural gas, LPG should be used for other purposes.

In the last decade more than $2.4 billion was invested to expand CNG use. Now CNG kits, tanks and compressors are manufactured domestically and the share of the environmentally-friendly fuel in public transport sector has reached 20% while LPG accounts for 3% of the energy mix.

Exporting LPG is also more beneficial than CNG since each ton of LPG sells for $500 in international markets whereas CNG has limited foreign demand because it needs costly investments and infrastructure.