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Iran interested in Asian, not European petrochemical markets

Business Materials 12 December 2015 15:02 (UTC +04:00)

Baku, Azerbaijan, Dec. 12

By Fatih Karimov - Trend:

The European markets are not attractive for Iran's petrochemical exports, Abbas Sheri Moghaddam, the Islamic Republic's deputy oil minister said.

"East Asian countries, China and India, are the main customers of the Iranian petrochemical products," Sheri Moghaddam, who heads the National Iranian Petrochemical Company, said, the official IRNA news agency reported Dec. 12.

He further said that international sanctions impose 10 percent extra costs for Iran's petrochemical exports.

The main challenge in petrochemical exports is the problem of money transfer due to sanctions, he added.

The Iranian official also said that under the international embargo, foreign transactions were conducted with a high risk due to impossibility of opening LC (line of credit), expressing hope that once the sanctions are removed exports will increase due to settling this problem.

During the sanctions period, some of the Iran's customers abused the opportunity to pay low price for the Iranian petrochemical shipments, Sheri Moghaddam further said.

Iran's petrochemical output hit 44.4 million tons in the past Iranian fiscal year (ended on March 20), 10 percent more year-on-year.

The country's actual production capacity is around 60 million tons, but the shortage of natural gas as feedstock, old production units, and the problem of sanctions, which has dropped exports, have caused petrochemical complexes to work at lower capacities.

Iranian petrochemical plants use 37 million cubic meters of natural gas per day, while Iran could deliver only 2.8 million tons of ethane to plants during last year totally. The country planned to increase this volume to 4.2 million tons this year.

The Islamic Republic hopes to realize an output of 120 million tons of petrochemicals by 2020 and 180 million tons by 2025.

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