Iran Oil Ministry to Invest $80m in Startups

EghtesadOnline: The Oil Ministry will invest $80 million in startups and knowledge-based firms, the oil minister said.

News ID: ۷۸۶۳۴۵

14 April 2021

Speaking on the sidelines of a ceremony to open the Oil Innovation and Research Fund in Tehran on Tuesday, Bijan Namdar Zanganeh said: “The Oil Ministry is determined to create opportunities for startups so that they can improve different sectors of the energy industry, especially manufacturing pipes, turbines and compressors,” IRNA reported.

The fund will support knowledge-based companies interested in the oil-related sector. “The ministry wants startups to propose new ideas and innovative plans to help cut production costs and improve productivity in the key sector.”

The ministry’s R&D department is tasked with expanding technological facilities for the rapidly expanding startup companies.

Zangan opened the first Oil Technology Park in Shahr-e-Rey in south Tehran last year that is providing researchers aid and equipment to implement their plans.

Iran’s oil industry is facing major challenges especially since 2018 and after the US unilaterally withdrew from the 2015 nuclear deal between Iran and six world powers, and reimposed economic sanctions, including on the oil, tech, banking and transport sectors.

The draconian sanctions have taken the form of an economic blockade and made it impossible for international companies to cooperate with Iran. As a result, local firms and startups have been emerging to help address the numerous challenges.

Startups have already produced and indigenized key catalysts and essential equipment and parts for the petrochemical and drilling sectors, Zanganeh noted.

According to Mohammad Sadeq Khayyatian, an official with Iran’s National Innovation Fund, due to overdependence on oil export revenue, the government did not pay enough attention to the revenue-generating potential of knowledge-based firm run and manned mainly by the youth.

Khayyatian said that has now changed and Iran is increasingly counting on the technology ecosystem for creating wealth and the government is also increasing its financial support to knowledge-based companies.

“The government is planning to offer hightech firms tax and customs exemption, ease the cumbersome process of issuing commercial licenses, cut social security insurance costs, reduce the obligatory military service duration and help empower innovative business.”

Of the 5,700 knowledge-based companies in Iran, 1,418 are involved in information and communications technologies, 1,267 in machinery and equipment and 1,111 in electronic products.

Caption: Startups have produced key catalysts for the petrochemical sector.