Managing Director of National Iranian Oil Refining and Distribution Company (NIORDC) Abbas Kazemi described the country’s plans to build new oil and gas condensate refineries despite the sharp decline in global oil prices; “the current stage is transient and the prices will eventually rise.”
Deputy oil minister stressed that the prices of crude oil will soon become realistic in the world market asserting “in the present circumstances, the main cause of the decline in crude prices has been the emergence of alternative energy sources, especially coal.”
“The increase in coal consumption is not environmentally appropriate and Western consumers will soon reject the current condition leading to realistic oil prices,” Kazemi added.
The official stressed that current prices would not represent a good criterion for the real price of oil noting “on the basis of the policies and guidelines of the Leader on avoiding crude retail, the construction of new oil refineries in the country remains justifiable.”
Reminding that Iran is seeking to build economical refineries and would not give up building of new refineries, NIORDC managing director underlined “economical refineries need to have a lower fuel oil capacity as well as that they should comply with the Euro 4 standard of the European Union.”
Kazemi emphasized that investment in constructing refineries is justified; “however, the construction of small refineries with very low capacities are not recommended,” he maintained.
“In order to be economically justified, an oil refinery needs to have at least 150 thousand barrels of production capacity,” said deputy oil minister stating “mini refineries are normally established with a capacity of 500 thousand barrels.”
“Siraf refining facilities mark an example of mini refineries which will be built with a capacity of 480 thousand barrels,” noted Kazemi concluding “In Siraf project, various parts will be constructed in an integrated fashion leading to a substantial reduction in the costs of building the refinery.”
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