Production of LNG economically unjustified: official

News ID: 2963009 -
TEHRAN, Nov. 10 (MNA) – Deputy-head of National Petrochemical Company has said US entering to LNG markets rules out Iran’s getting hand in future LNG production as economically unjustified.

Mohammad Hassan Peyvandi who was speaking in a press conference on Tuesday, said that Iran’s current petrochemical sector had many advantages in attracting international investments in post-JCPOA; “with the world’s largest natural gas reserves, access to open seas, and proximity to great consumer markets such as India and China, and high security would be attractive to investors,” he told reporters. “Iran’s current policy post-JCPOA is to rework methanol production units to propylene and polypropylene production plants, which provides the larger part of the feed for additional petrochemical industries; however, one of the challenges facing Iran’s petrochemical industry is increasing capacities in US gas production and country’s entering into LNG market; by 2013, the US had no single percent of share of global LNG market; now, it is estimated that by 2020, the US will have a 10-per cent share of the LNG market,” he added.

“The US currently works on building several terminals for LNG exports; it is estimated that by the end of 2015 first such terminal will operate,” Peyvandi told reporters.

“The US had extensive plans to raise export of ethane to EU; with US ethane in the market, naphtha consumption will decline, with US ethane virtually replacing naphtha in petrochemical complexes,” he predicted. “With this conditions on the horizon, Iran’s getting a hand in LNG global market is economically unjustified; gas exports either via western pipeline or as LNG will not be economically justified even if it enjoys a 50 per cent efficiency compared to production of petrochemical products; in the most optimistic condition, half of the product is wasted away; but in petrochemical complexes, the whole feed including natural gas and naphtha becomes product, and practically, exports of these products even if under sanctions is economically wise,” he detailed.

Peyvandi also announced future establishment of a new hub to expand petrochemical industry in Persian Gulf and Sea of Oman coasts, with five port and economic zones of Chabahar, Qeshm, Jask, Lavan, and Sarakhs functioning focal points of petrochemical products.

 

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