“The share of gas feedstock in plants is 77% while liquid feedstock accounts for 23%. This share will be 86% and 14% respectively by 2025,” Behzad Mohammadi was quoted as saying by the Oil Ministry news agency Shana.
Feedstock for the petrochemical industry globally has gradually shifted from liquid to gas and the share of gas feedstock (ethane and LPG) for petrochemical units will increase from 34.7% in 2018 to 42.6% by 2040.
“A variety of feedstock is used in the domestic petrochemical industry including natural gas (27%), gas condensate (23%), rich gas (17%), ethane (14%), NGL (10%), naphtha (7%), and kerosene (2%),” Financial Tribune quoted Mohammadi as saying.
Given the role of natural gas is producing a large variety of petrochemicals plus the increasing supply of feedstock is yet another sign of the move towards generating higher revenue from value-added products than selling natural gas, he noted.
Currently 56 plants are operational across the country and 23 more are under construction, which are expected to start production by 2025.
Referring to government plans to expand the petrochemical sector, Mohammadi said Iran has invested $53 billion in the industry and total investment will reach $93 billion by 2025.
The 56 petrochemical plants produce almost 31 million tons of finished products annually, of which 22.5 million tons are exported and 8.5 million tons consumed domestically.
The total value of petrochemical products from domestic sales and exports is in the region of $17 billion a year.
Iran plans to double investment in its petrochemical industry with the aim, among other things, of making up for losses emanating from the tough US sanctions on its oil exports, Mohammadi said.
Oil production and exports have plunged since last year when the US abandoned from the 2015 nuclear deal signed between Iran and six world powers and re-imposed restrictions on the economy, mainly targeting the energy, banking and transport sectors.
Iran's oil output in August was 2.3 million barrels per day -- down from 3.8 million bpd in June.
Iran has been boosting petrochemical exports, directly or through its commodity exchange, to compensate for sliding oil income. While US sanctions announced in November 2018 also affect this sector, export of petrochemicals has faced less problems, at least so far.
Income Factor
Petrochemical exports were Iran's biggest source of foreign currency income in the past year, the oil minister said Sunday.
"Compared to other sectors, this industry plays the biggest role in bringing back forex income from exports," Bijan Namdar Zanganeh was quoted as saying by Shana.
He said annual petrochemical production capacity, which now is 66 million tons, would cross 100 million tons by 2021 and reach 130 million tons four years later.
The petrochemical sector is planned to generate more than $25 billion by 2022, and $37 million by 2025, compared to the present $17 billion.