IRAN - Bandar Imam Projects.

The Special Petrochemical Economic Zone (SPEZ), in an area of 1,700 hectares, was established in mid-1998 as the country's first specialised industrial park with a free zone status. It was developed around NPC's Bandar Imam Petrochemical Complex in a northern Persian Gulf port originally known as Bandar Shahpour, a complex on which work began in the early 1970s as an Iranian-Japanese JV (IJPC) and was completed in the 1990s. Pre-SPEZ industries in the area also include the Razi Petrochemical Complex, the Mahshahr gas refinery and the privatised Farabi Petrochemical Complex. SPEZ, the site of four major olefins complexes, will have a total capacity of 3m t/y of ethylene by 2004. Phases 1-3 projects at SPEZ are:

Olefins-6: This includes a 520,000 t/y ethylene plant being built by Linde under a BBP for NPC's Amir Kabir Petrochemical Co., and Iran's first three JVs for programmed projects - the first JVs involving private firms since the Khomeini regime came to power in 1979: a 300,000 low density polyethylene (LDPE) plant, a model JV in which Elenac (50-50 Shell/BASF) holds 55% and Amir Kabir has 45%, to use Elenac's LUPO Tech T technology and start up in 2003 - with Elenac to run the plant and market its output abroad; and a 300,000 t/y LDPE and linear LDPE (LLDPE) plant in which the UK-registered and private Iranian controlled Balli Group holds 60% and Amir Kabir has 40%, to start up in 2003 - with Balli being the main buyer of NPC exports; and a 160,000 t/y polypropylene (PP) plant, in which the private local Alia Bahar Gharb and Amir Kabir are partners. Under a euro 100m BBC signed in 2000, Technip has built Amir Kabir's other 300,000 LLDPE plant based on BP's gas-phase Innovene process. Amir Kabir has a 140,000 t/y high density polyethylene (HDPE) plant built at this complex using Elenac's Hostalen process, which started up in early 2002.

Olefins-7 of NPC's Marun Petrochemical Co., is being built by Linde under a $333m BBC it got for this and the Olefins-6 unit in July 2000. Linde is building the 1.1m t/y ethylene cracker, which will use ethane from associated gas, and a 200,000 t/y PP plant. Krupp Uhde is building a 300,000 t/y HDPE plant, under a DM200m BBC it got in Oct. 2000. In Sept. 2000 Marun gave Tecnimont two BBCs worth $200m to build a 400,000 t/y ethylene glycol plant using Shell technology and a 300,000 t/y PP plant using Shell-affiliated Montel's technology, with both to be on stream in 2003.

Olefins-8, for which Shell and Elenac have done a feasibility study as potential partners, is part of Phase-3. Linde has been selected to the BBC. but the capacity of the complex's ethylene cracker and downstream units have been scaled up, with the site of the gas separation plant changed. These changes and the prospect of Shell/Elenac becoming NPC's partners in this, have necessitated further negotiations with the contractor. Now they say Olefins-8 will not be on stream before 2007. The cracker's capacity has been scaled up to 1.3m t/y from 810,000 t/y. The complex will include a propane dehydrogenation unit, a swing PE plant to produce LLDPE and HDPE and a PP unit.

NPC's Bandar Imam Petrochemical Co. is to have at its complex a plant in 2003 to recover 150,000 t/y of ethane and 50,000 t/y of propane from the fuel gas of its NGL facility. The recovered feedstocks will supply its olefins plants.

Aromatics-3, for NPC's Bou Ali Sina Petrochemical Co. and on stream recently, produces 257,000 t/y of paraxylene, 106,000 t/y of benzene, 47,000 t/y of LPG, 90,000 t/y of raffinate, 467,000 t/y of light cuts, 849,000 t/y of heavy cuts, and 32,000 t/y of heavy aromatics. The licence and basic engineering were provided by Krupp Uhde, Institut Franais du Petrole (IFP) and Sinopec of China. The plant was built by a partnership of Ferrostaal and the local private Petrochemical Industries Design & Engineering Co. (PIDEC) under a $240m BBC awarded in March 2000.

A 180,000 t/y paraxylene plant, commissioned in May 2000, was inaugurated in Feb. 2001 by President Khatami in a big ceremony. It was built with Iranian labour and French and Belgian expertise.

Engineering Polymers: NPC's Khousestan Petrolemical Co. at Bandar Mahshahr, near Bandar Imam Khomeini, produces engineering polymers, with its strategically important technology being the first of its kind introduced in the Middle East. The first such plant in Tabriz was completed in recent years. The plant has six units - including one for 25,000 t/y of polycarbonates, and units for 30,000 t/y of bisphenol A, and 10,000 t/y of liquid epoxy resins. The plant went on stream in 2002.

(Iran will consume 5,000 t/y of polycarbonates in the near future, so the surplus is exported. Engineering polymers have high performance and can replace metal and wooden parts or ceramics in various industries, such as auto making, and fabrication of office, engineering and household wares. Their exceptional mechanical and chemical properties and their longevity are the outstanding features in polymers).

Methanol-3, with a capacity of 1m t/y and on stream recently, was built by Snamprogetti under a $200m BBC awarded in Oct. 1999. This is based on Haldor Topsoe technology. Methanol 1&2 plants have been on stream already.

PET/PTA 2: Part of a plant run by NPC's Shahid Tondguyan Petrochemical Co., a second polyethylene terephthalate (PET-2) unit is being built by Lurgi Zimmer of Germany, under a DM160m BBC, to produce 412,000 t/y of fibre and bottle grade PET.

The adjacent 350,000 t/y purified terephthalic acid (PTA-2) plant, described as the biggest of its kind in the world, is being built by a Japanese consortium of Mitsubishi Heavy Industries, Mitsubishi Chemical Corp., Tomen and the local Chegalesh under a BBC awarded in Oct. 2000. Both to be on stream in 2003, they will be next to the PET/PTA-1 units.

NPC's Fanavaran Petrochemical Co. has a 140,000 t/y carbon monoxide (CO) plant built by Snamprogetti under a $40m BBC awarded in March 2001. It went on stream recently. It feeds a 180,000 t/y acetic acid plant nearby built by LG Engineering of S. Korea under an $80m BBC awarded at the same time.

NPC's Razi Petrochemical Co. is having a 50,000 t/y linear alkylbenzen (LAB-1) unit in its plant being built by Tecnicas Reunidas of Spain in partnership with the local Enerchimi under a BBC.

Razi's fertilisers plant is being expanded with a new 1,800 t/d urea granulation under a BBC awarded to Snamprogetti of Italy and the local Sazeh Consultants in Feb. 2001, with Norsk Hydro providing the technology. It is having a 676,500 t/y ammonia plant built which will complement two existing ammonia units with a total capacity of 660,000 t/y.

he ParsEE Projects: The following are projects sited at Bandar Asaluyeh's Pars Special Economic/Energy Zone (ParsEE), Established in Sept. 1998:

Olefins-9's ethane cracker to produce 1m t/y of ethylene and 300,000 t/y LDPE and 300,000 t/y LLDPE plants are a JV of NPC's Pars Petrochemical Co. (PPC) and Sasol of South Africa, to be on stream in mid-2003. They are being built by Technip and the local Nargan, contracted in Sept. 2000. Linde and Nargan are building a 3 MCM/h gas separation plant for Olefins-9.

On its own, PPC is having plants built to produce a 600,000 t/y of styrene monomer and 400,000 t/y of monoethylene glycol (MEG) by 2005.

Olefins-10 for NPC's Zagross Petrochemical Co. and its downstream unit Jam Petrochemical Co has a 1.345m t/y steam cracker, able to use ethane and/or naphtha and the biggest of its kind in the world, being built by Technip and Nargan under a euro 300m ($280m) BBC awarded in March 2001. The complex is to be on stream by 2005. Naphtha is to be supplied by the aromatics-4 complex being built nearby (see below). Jam in Jan. 2001 had awarded BBCs worth euro 350m ($330m) to Tecnimont to build a 400,000 t/y MEG unit, a 300,000 t/y PP unit and 300,000 t/y LLDPE unit. The DM250m ($120m) BBC for a 300,000 t/y HDPE units was awarded to Krupp Uhde and the local Sazeh, with the latter being a partner and subcontractor in several other BBCs.

Olefins-11 is a complex proposed to be a JV between NPC and Saudi Arabian Basic Industries Corp. (SABIC). This is still under study, with both sides yet to determine the capacity and its range of products.

Aromatics-4 for NPC's Borzoyeh Petrochemical Co., to be on stream in 2003, will supply Olefins-10 with naphtha. Its complex is being built by a group of Toyo Engineering (the leader) of Japan, Shinwha Engineering of South Korea and Sazeh under a yen 43,000m ($403m) BBC signed in June 2000. It will produce 750,000 t/y of paraxylene, 430,000 t/y of benzene, 100,000 t/y of orthoxylene. By-products will be 720,000 t/y of light cuts, 2m t/y of heavy cuts, 80,000 t/y of LPG, 375,000 t/y of raffinate and 64,000 t/y of heavy aromatics. The complex's feedstock will be 536,000 t/y of NGL, about 4.5m t/y of condensates from South Pars and 270,000 t/y of pyrolysis gasoline from Olefins 9&10. Mitsui & Co. is helping in the financing effort and the complex, described as the biggest of its kind in the world, should be on stream in 2004. The other olefins complexes mentioned above are based on ethane as feedstock for ethylene.

Methanol-4 for NPC's Dena Petrochemical Co. has a 1.65m t/y plant being built by Lurgi and PIDEC under a $145m BBC signed in late Dec. 2000. It will process 180,000 CM/h of gas and 120 t/h of oxygen to produce 5,000 t/d of Grade AA methanol, totally planned for export. Lurgi will use its new Gas Cooled Methanol Reactor technology. The plant is to be on stream by end-2003.

A fertiliser complex at ParsEE came on stream in 2002 built by Toyo, Chiyoda and PIDEC. It has the capacity of 3,250 t/d of urea and 2,050 t/d of ammonia, with the methane feedstock coming from South Pars gas.

A centralised utility plant for NPC's Unipars Petrochemical Co. is being built to supply the above mentioned complexes and other ParsEE-based industries with power, steam, desalinated water, demineralised water and nitrogen.

A 70,000 b/d GTL venture in ParsEE is being promoted by Shell as a JV with NPC, with the possibility of a local private company joining it as well. Shell completed a six-month feasibility study on this in early March 2001 which, as expected, concluded that the project was economically viable. Based on its SMDS technology, it will be similar to Shell's 12,000 b/d GTL plant at Bintulu, Malaysia. It will use about 600 MCF/d of gas, to be produced from the South Pars field. Apart from the 70,000 b/d of zero-emission distillates, diesel and aviation fuel which will command a premium in the OECD world, the plant will produce high-priced paraffins and waxes, plus about 10,000 t/d of sweet water that can be used for irrigation in the Asaluyeh desert region. (Shell, promoting similar GTL ventures in Egypt, Indonesia and Trinidad, is also proposing to have an LNG export venture built at ParsEE in partnership with Repsol and NIOC - see Gas Market Trends of this week. For example, Shell is now promoting an integrated LNG/GTL venture in Egypt, which it says will be profitable).

However, Oil Ministry and NIOC experts who have visited the Bintulu plant at Shell's invitation, say this GTL project will cost $1.5 bn and will thus be too expensive for Iran. They suggest that first Shell should start up a 70,000 b/d GTL venture elsewhere and prove its profitability and then have such a project built in Iran.

A competing GTL project is being promoted by NPC in partnership with Sasol, which in 2002 completed a joint pre-feasibility study for a 70,000 b/d plant. ABN Amro was contracted last month as adviser for the project's first phase and for a six-month financial feasibility study. NIOC's Research Institute of Petroleum Industry and JNOC of Japan in early 2003 signed a co-operation agreement to develop a GTL technology described as oxididative coupling of methane (OCM), which oxidises natural gas into ethylene and other products.

In March 2002 JNOC, Jetro and Japan Energy Research Centre (JERC), together with Japanese trading houses and oil companies completed five feasibility studies on three dimethyl ether (DME) and two GTL projects promoted in Iran, Indonesia, Qatar and Australia. Two DME projects were studied for South Pars on the basis that natural gas would be supplied at an affordable prices of a 5,000-7,000 t/y DME plant.

Japanese trading house Tomen in late 2001 announced a $1.6 bn GTL project in Iran to be built by 2006 with a capacity of up to 75,000 b/d. Tomen said it was to be a partner in this together with other companies.

Petrochemical Ventures Elsewhere In Iran: There are several new petrochemical ventures elsewhere in Iran. They include private ventures which are expanding. The main NPC and private ventures are the following:

An integrated ammonia/methanol plant on Kharg island, Iran's main oil terminal, is being tendered. This will have a capacity to produce 2,000 t/d of methanol and 1,500 t/d of ammonia. NPC is having a 500,000 t/y ethane cracker project to be built on Kharg island as well.

A 660,000 t/y methanol plant on Kharg went on stream in March 2000 and was inaugurated by President Khatami. Built by Lurgi under a BBC, this is part of NPC's Phases 1&2 and took 48 months to complete at a cost of $149.4m plus IR465.5 bn. Its first shipment, 10,000 tons, went to China by tanker as the plant was inaugurated. Most of Kharg's methanol output now is being supplied to a 500,000 t/y MTBE plant at the Bandar Khomeini complex which came on stream in March 2001. In 1998, NPC offered public subscription for this plant on the Tehran Stock Exchange and raised about $24m to help finance it.

A 30,000 t/y ethanolamin unit at Arak petrochemical complex came on stream at the beginning of March 2000. This complex has a grassroots plant which went on stream recently with a capacity to produce 30,000 t/y of ethoxylates, with Ballestra of Italy having provided the technology. The plant will raise Arak's olefins capacity by 25%

A 50,000 t/y LAB plant near Kermanshah has been built for NPC's Mashal Daran Petrochemical Co. by Tecnicas Reunidas of Spain and Enerchimi, with basic engineering done by IFP which also supplied the technology. The plant went on stream in 2002.

A 50,000 t/y LAB plant at Bandar Abbas is to be a JV between NPC and Qatari United Development Co. (UDC), for which a letter of intent was signed in June 2000. A joint feasibility study was done in Aug. 2000. UDC is a new company, launched in 1999 through an initial public offering (IPO) to invest in both upstream and downstream opportunities in Qatar and the neighbouring countries.

NPC's Isfahan petrochemical complex has a plant producing 21,500 t/y of phthalic anhydride (PA) and 40,000 t/y of dioctyl phthalate (DOP).

Kerman Tyre & Rubber Co., which produces 2.5m car and truck tyres a year, in mid-Oct. 2000 signed a JV agreement with Continental of Germany to co-produce in Iran tyres for the domestic and abroad, with Central Asia and the Middle East being growth markets.

The Ilam olefins complex near the border with Iraq, to be contracted this month, will have an ethane cracker with a capacity of 300,000 t/y. This will have a 300,000 t/y HDPE plant and an 80,000 PP unit.

The feedstock will be provided from associated gas and propane-plus (C3+) from a nearby gas plant at Ilam, which processes products from onshore oilfields in western Iran, including the Naft Shahr field. The complex is to be completed in 2006.