Baku, Azerbaijan, Apr. 21
By Dalga Khatinoglu- Trend:
Iran's president kicked off his trip to Indonesia on April 21 to attend a ceremony marking the 60th anniversary of the Asia Africa Conference.
"Rouhani is scheduled to hold a number of bilateral meetings with several heads of state, including Japanese Prime Minister Shinzo Abe and the host country's president, on the sidelines of the event, Iran's Ambassador to Indonesia Valiollah Mohammadi Nasrabadi said.
Just a year ago, Iran announced that it is preparing to build five refineries in Indonesia, aimed to diversification of Iran's oil export. The head of Iran's Oil, Gas and Petrochemical Products Exporters Union said last April that Iran would build a heavy oil refinery with the daily production capacity of 150,000 barrels of crude oil in addition to five smaller refineries with daily production capacities of 30,000 to 50,000 barrels of gas condensates in Indonesia.
The total refining capacity of 300,000 barrels per day would be fed by Iranian crude oil and gas condensate.
Almost all of Iran's crude oil-export goes to the Asian markets: including China, India, Japan and South Korea.
Iran's oil export has decreased from 2.5 million barrels per day (mb/d) in 2011 to about 1.1 mb/d currently due to western sanctions. However, in the light of rising hopes to resolving Iran's nuclear dispute through negotiations, Iran is preparing to boost its oil production and export.
Iranian oil firm Nakhle Barani Pardis and Indonesia's PT Kreasindo signed a $3 billion agreement last February for the construction of six refineries. Nakhle Barani Pardis has reportedly accepted to finance 30 percent of the refinery to be built at Banten or another location in West Java.
Iran's Press TV reported then that the projects were set to start in 2015 and would take an estimated three years to complete.
However, during Rouhani's visit to Indonesia to take part in a 5-day conference, the country's Oil Minister Bijan Namdar Zanganeh didn't accompany him.
Despite this huge project, which creates opportunity for Iran to increase its oil export as well as benefits from a country that relies on one third of its needed liquid fuels from imports.
A strong economy, population growth, and continued state subsidies for fuels worked together to push domestic oil demand beyond supply in Indonesia.
Edited by CN
Dalga Khatinoglu is an expert on Iran's energy sector, head of Trend Agency's Iran news service.
Follow him on @dalgakhatinoglu