Iran will invest $46 billion for the development and optimization of its refineries, Iranian Deputy Oil Minister Alireza Zeighami announced.
Seven refineries are currently under construction in Iran, which will make the country self-sufficient in gasoline production in two years, Zeighami told reporters at a press conference on Sunday, IRNA reported.
Approximately $8.5 billion of the $26 billion required for the refinery construction project has already been spent, he noted.
Iran’s daily gasoline production currently stands at 45 million liters, although the country consumes 65 million liters per day, but when the new refineries come on stream in two years, gasoline production will increase by 25 million liters per day, Iran’s deputy oil minister added.
He went on to say that the sanctions imposed on Iran are “ineffective” and constructing refineries will not be a problem for Iran.
“We will provide the funds for the refinery projects through (independent) banking consortiums and there is no concern in this regard,” Shana quoted Zeighami as saying.
On Monday, the European Union imposed new sanctions on Iran which mainly target investment in and technical assistance to Iran’s refining, liquefaction, and liquefied natural gas sectors.
On June 9, the UN Security Council passed a US-drafted resolution imposing sanctions on Iran over its nuclear program. Afterwards, the US and the EU took unilateral measures against Iran.
Iranian officials say that as a signatory to the Nuclear Non-Proliferation Treaty, the country has the right to develop or acquire nuclear technology for civilian power generation and medical research.
Tehran has repeatedly declared that it will not relinquish the legitimate nuclear rights of the Iranian nation, no matter how much pressure the Western powers put on the country.
Iranian Oil Minister Massoud Mirkazemi said the imposition of additional sanctions by the European Union against Iran will not reduce the production of oil in the country.
“Over the past 31 years, Iranian companies and workers in Iran’s oil industry have developed this industry in the country and even if new sanctions are imposed by the European Union, our [oil] production will not drop,” Mirkazemi told IRNA on the sidelines of a Sunday cabinet meeting.
“Currently 100 percent of Iranian oil and gas fields are being exploited by Iranian companies,” Mirkazemi said.
He went on to describe European Union efforts to slap unilateral sanctions against Iran’s energy sector as an example of contradictory behavior in the international arena.
“The Europeans and Americans have for years tried to establish world free trade, but today they want to contradict their decades-long efforts with a few resolutions,” said the Iranian minister.
“If decades of efforts can easily be challenged with a few resolutions, either the global structure is futile or resolutions have no standing,” Mirkazemi added.
Managing Director of the National Iranian Oil Distribution Company (NIODC), Farid Ameri, said on Monday that Iran has managed to save 11 billion dollars thanks to the gasoline rationing plan, which has spared the need for excessive imports of the commodity.
Referring to the distribution and delivery of 17 million fuel smart cards to Iranian auto drivers, Ameri said since 2007, upon the implementation of gasoline rationing plan, some $11 billion have been saved.
He said that had the gasoline rationing plan not been implemented, fuel consumption nationwide would have reached as much as 98 million litters per day, IRNA reported.
Under the gasoline rationing plan, a total 180 liters of gasoline have been considered for the summer season, some 60 liters for private vehicles in each month of summer.
Based on official estimates, daily consumption of open market gasoline has risen to nine million liters this year from 1.5 million liters on average last year.
Oil prices hovered for a second day near $79 a barrel Tuesday in Asia as investors weighed a three-day stock market rally against signs of sluggish US crude demand.
Benchmark crude for September delivery was down 3 cents at $78.95 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract was unchanged to settle at $78.98 on Monday.
Surging US stock markets have underpinned oil prices as traders often look to equities as a barometer of overall investor sentiment. The Dow Jones industrial average rose 1 percent Monday and is up about 4 percent in the last three trading sessions. Most Asian stocks gained Tuesday.
“We still see a relatively close linkage between the stock market and the oil for now,” Ritterbusch and Associates said.
Meanwhile, US crude inventories in recent weeks have either grown or fallen less than analysts expected, suggesting consumption remains tepid. The American Petroleum Institute reports supply data for last week later Tuesday with the Energy Department’s Energy Information Administration reporting Wednesday.
“Oil fundamentals are looking more bearish with each successive EIA report,” Ritterbusch said.
In other Nymex trading in August contracts, heating oil rose 0.24 cent to $2.045 a gallon, gasoline was steady at $2.106 a gallon and natural gas gained 2.6 cents to $4.638 per 1,000 cubic feet.
Brent crude was down 7 cents to $77.43 a barrel on the ICE futures exchange.
Energy Ties With Iraq
First Vice President’s Deputy Ali Aqa-Mohammadi and the Iraqi Prime Minister Nouri Al-Maliki held a meeting.
During the meeting the two sides called for expansion of economic ties, the Islamic Republic of Iran News Network reported.
The officials negotiated about removing costumes’ obstacles and accelerating the tradespersons’ visits.
Al-Maliki underlined the Iraqi government’s desire to develop ties with Iran in all fields, especially in the fields of electricity and oil.
Al-Maliki also stressed that Iraq will move towards construction and development of the Iraqi economy following the formation of the new government.
The Iraqi official called for greater participation of Iranian firms in his country’s economic plans.
For his part, Aqa-Mohammadi reiterated his government’s support for the Iraqi government’s efforts in maintaining stability and achieving prosperity.
During his visit to Iraq Aqa-Mohammadi also held a meeting with Iraqi Oil Minster Hussain Al-Shahristani.
Meanwhile Iran’s First Vice-President Mohammad-Reza Rahimi said that Iran can transfer its high economic power to other parts of the world.
Speaking in ceremonies to inaugurate a 400.63 kilovolt power station in Mahallat, southwest of the capital city Tehran, Rahimi said Iran has made huge amount of investment in the neighboring and African countries.
He recalled a time when an Iraqi prime minister sought Iran’s electricity aid at the time of his country’s power outage and said Iran added 200 kilovolts to the amount of electricity exports to Iraq.
He added that Iran has also entered a deal with Turkey for power sale and noted that the country’s high electricity generation potential is source of honor.
$500m in Bonds To Fund SP Projects
The Pars Oil and Gas Company will issue $500 million in bonds to finance the exploitation of South Pars gas field.
Managing Director of the company Ali Vakili said the participation bonds are expected to be offered by August 21 through Saderat Bank.
“Recently the Pars Oil and Gas Company has been authorized by the Central Bank of Iran to issue participation bonds; it plans to issue $500 million in bonds in the month of Mordad (23 July - 21 August),” Shana quoted Vakili as saying on Sunday.
The official noted that the Majlis (parliament) for this year has projected issuing a total of $5 billion in bonds for development of Iran’s oil industry. Some $3 billion of the bonds will be used to finance the South Pars gas project, Vakili said.
The South Pars gas field is jointly owned by Iran and Qatar. The Iranian share of the field has reserves of about 14 trillion cubic meters of gas, which accounts for about eight percent of the total world reserves.
On Saturday Vakili said that investment in the South Pars gas field has increased by 120 percent during the current Iranian year. He told IRNA that the boom was the result of the issuance of €3 billion in foreign currency bonds and $3 billion in national participation bonds.
Vakili added that investment in South Pars had surpassed $11 billion. “Due to accurate planning, this year there will be no problem with regard to funding the South Pars project,” Vakili said.
Iran has the world’s second largest natural gas reserves after Russia.
Gas Exports to Turkey
By the launch of the Sixth National Network Gas Pipeline, as the second gas export pipeline to Turkey, gas export capacity to the country via Eighth Operating Region will rise by 50 to 60 million cubic meters per day.
Director of the Iran’s Eighth Operating Region for Gas Transfer, Valiollah Dini told reporters that current capacity to transfer gas to Turkey through existing gas pipeline in the Region is 30 million cubic meters per day that could be raised to 45 million cubic meters per day.
He also said that by launching the Sixth National Network Gas Pipeline, current capacity for exporting gas to Turkey will mount to 80 to 90 million cubic meters per day.
According to Dini the Eighth Operating Region of the country transfers 40 to 45 million cubic meters per day at present, of which 25 million cubic meters is being exported to Turkey.
Stressing on the important role of gas pressure installations on securing gas export, Valiollah Dini said Bazargan Gas Pressure Station is one of the most important gas facilities in the Eighth Operating Region that its operation would be halted in September for a short time due to overhaul.
He named the overhaul as one of the biggest fixing operations in last few years and said that based on coordination with Turkish side, gas exports to Turkey will be stopped for a short period.
Managing director of the National Iranian Gas Export Company (NIGC) has said on Friday that by construction of a 56 inches gas pipeline over the three next years, Iran will be able to export 50 to 60 million meters of gas per day to Turkey and Europe through the pipeline.
Javad Oji added that Turkey intends to transfer Iran’s gas to Europe by construction of an independent gas pipeline in its soil.
He went on to say that by signing the contract on Thursday, the first step was taken to realize the plan. He noted that by launching the independent pipeline, NIGC would be able to market its gas in Europe by paying transit fee to Turkey.
A gas transferring pipeline contract between Iran and Turkey, 660 kilometers long and worth one billion euros, was signed by NIGC and Turkish ASB Company on Thursday.
Iranian Oil Minister Masoud Mirkazemi went to Ankara last week to talk with his Turkish counterpart Taner Yildiz on the expanding cooperation on oil and gas.
Taiwan Keen on Stronger Ties
Taiwan’s Ministry of Foreign Affairs announced that the Taiwanese government is keen on commercial cooperation with Iran, despite a new round of international sanctions against the Islamic republic.
Taiwan’s Ministry of Foreign Affairs Spokesman Henry Chen told Focustaiwan that as long as business ties with Iran create commercial profitability for people, government is not against it.
“Taiwanese businesspeople have been doing business with Iranians for a long time. The bilateral relations were not developed overnight. Businesspeople will do whatever they think is profitable even if they have to do so without help from the government,” he added.
While Taiwan does not rule out developing closer trade relations with Iran, setting up a trade office in Taipei would require much more consideration, he said without elaborating.
The Taiwan External Trade Development Council, a semi-official agency in charge of foreign trade promotion, established an office in Tehran in 1992.
More than one million job opportunities have been created in the
cooperative sector during the past four years, Deputy Minister of
Cooperatives Abdolmajid Gharib-Reza said.