IRAN - The Gas Sector & Processing Plants.

Addressing an energy conference in Brussels in November 2006, Iranian Deputy Oil Minister for International Affairs Hadi Nejad Hosseinian said his country was to raise its natural gas production capacity from 130 BCM/year to 300 BCM/y by 2015 and to 400 BCM/y by 2025.

Hosseinian said Iran had plans to export LNG to China, India, Japan, East Asia and Europe, adding: "We are currently exporting gas to Turkey, and exports to Armenia, Nakhichevan and the UAE will start soon". But exports to the UAE emirate of Sharjah are likely to be delayed beyond 2007. The infrastructure for exports to Armenia was inaugurated in March 2007.

The National Iranian Gas Co. (NIGC), a unit of NIOC, has expanded its gas treatment and processing capacity to provide for domestic consumption, for injection into the oilfields and for exports. NIGC said in early 2003 it had set a target to raise its gas processing capacity from 320 MCM/d to 583 MCM/d before 2010.

The Ilam gas processing plant with a capacity of 6.8 MCM/d will come on stream in September 2007. This was announced recently by the Deputy Oil Minister for Gas Affairs and CEO of NIGC, Reza Kassaeizadeh. He said gas consumption in Iran showed an 11.7% increase in the last Iranian year (which ended on March 20, 2007), with the volume having amounted to over 119 BCM, up from around 103 BCM in its preceding year.

Each of the 28 phases in the development of South Pars, an offshore gas super-giant which is an extension from Qatar's North Field, will be producing and processing about 1,000 MCF/d of gas and will have an average condensate output of 40,000 b/d. Some of the phases will be producing LPG as well. All the phases will be producing sulphur and South Pars gas, like the North Field's, is sour but rich in liquids (see gmt15FieldsApr9-07).

Kangan-Nar is Iran's biggest gas processing plant with a capacity of 80 MCM/d. The second phase of its expansion started up in September 1995, increasing by a third the volume of gas available for local use. The plant processes gas from the Nar and Kangan fields. The plant and the two fields' limited development have cost over $1.5 bn. The plant's first phase, for which Daewoo of South Korea was the contractor and originally scheduled to start-up by end-1988, was damaged by two Iraqi air raids in June and July 1988. The first phase was inaugurated in February 1990. It was completed by Daelim, another South Korean firm. The plant's output was originally intended to be exported to the former Soviet Union as well as meet domestic needs. But exports to the FSU were stopped in the 1990s. An NGL pipeline was built from Kangan to Bandar Taheri as part of the first phase. The 40-km pipeline, 10-inches in diameter, was inaugurated in September 1990. Another pipeline from Nar was built and was expanded in 1995 for the second phase. The plant also can produce 50,000 b/d of NGLs.

Aghar-Dalan plant, in Fars province, came on stream in late 1992 to process gas from the nearby Aghar and Dalan fields. It has a 35 MCM/d capacity. An expansion and upgrading of the plant was done in late 1995. Sofregaz of Gaz de France was among the suppliers of equipment. The processed gas is fed into NIGC's IGAT-II pipeline for local use.

Ahwaz plant came on stream in March 1992 with a capacity of 25,000 b/d of NGLs, now supplied to the LPG plant at the Bandar Imam petrochemical complex, plus 70 MCF/d of dry gas. The second phase was completed six months later and boosted the plant's capacity to 120 MCF/d. Of this, NIGC's distribution grid takes 50 MCF/d, and the rest is reinjected into the Ahwaz oilfield.

Marun-4 plant's first phase came on stream in April 1989 with at 40 MCM/d fed into NIGC's distribution grid. The second phase, completed in early 1994, raised the capacity to 2.8 BCF/d. Most of the dry gas is reinjected into the Marun oilfield.

Phase-1 of a system to collect and process associated gases from the Ahwaz, Abe Teymour, Koupal, Mansouri and Marun oilfields came on in mid-2005. The system will eventually end 240 MCF/d of sour gas flaring, extract NGLs and make up for part of the domestic gas shortage. Once the gas is sweetened at the system, the output comes to 6 MCM/d of enriched gases, 5,000 b/d of sweet NGLs and 510,000 CM/d of acid gas (see background in gmt15IranGasExprtApr11-05).

The Bid Boland plant processes 800 MCF/d of gas from the Agha Jari oilfield, from where it is taken through a 40-inch pipeline. Some gas from Ahwaz is processed at Bid Boland as well. The plant was damaged by Iraqi air raids in 1986-1988. But Iranian engineers brought two of its five processing trains back into operation by early 1989. The rest came back on stream in the second half of 1989. Bid Boland II plant with a capacity of 40 MCM/d will be on stream by 2008 - three years behind schedule as the EPC contracts were awarded in April 2005 - to take South Pars gas from Phases 6-8 of the offshore South Pars field. The ethane will go to a nearby cracker and the propane and butane (LPG) are for export. The methane will go into the domestic pipeline system. The EPC job for Package A, i.e., for the plant, went to a consortium of Dragados (Spain), Costain (UK), and the local Sazeh Consult and Jahanpars.

Qeshm island's plant treats gas from the Sallakh field, which has high CO2 and N contents. The processed gas is supplied to power plants nearby.

The Sarkhun plant, completed in 1995, processes 55 MCM/d of raw gas from the Sarkhun field, behind Bandar Abbas on the Straits of Hormuz. Sarkhun-2, built for $84m, came on stream in mid-1996 with a capacity of 375 MCF/d and processes gas from Sirjan and Rafsanjan fields.

Khangiran plant, in the north-east, came on stream in the 1980s with a 21 MCM/d capacity. It was expanded to 35 MCM/d by early 1994. The plant consists of five trains processing gas from Sarakhs field and other structures in the region. It supplies dry gas to the Neka power station on the Caspian Sea and both dry gas and LPG to industrial and domestic users in the area. The plant has desulphurisation facilities with a throughput of 1,950 tons/d and a gas-gathering system, with independent separation and dehydration units. The plant's expansion was programmed to coincide with the extension of the domestic gas grid from Sarakhs to Rasht and Azerbaijan province. A second phase of the Khangiran plant is to be built to double its capacity.

Shahid Hashemi plant has a capacity of 30 MCF/d. It was left incomplete by foreign contractors towards the end of the Iran-Iraq war in 1988. Iranian firms took up the job and completed it in 1989.

Asaluyeh plant, with a capacity of 75 MCM/d, came on stream in early 2003. The plant takes gas from Phases 2-3 of the South Pars field and from Phase 1. Another plant at Asaluyeh to take South Pars gas from Phases 4-5 went stream in late 2004 with a capacity of 50 MCM/d. Asaluyeh is to have other plants to process gas from South Pars from phases beyond 6-8. A plant is being built at Asaluyeh for PetroIran to process gas from the offshore Salman field as well.

Dehydration units taking gas from Shanul and Varavy fields from 2004 have a capacity of 21 MCM/d. Similar units completed in 2005 take gas from the Tabnak field and has a capacity of 51 MCM/d.

A plant to treat gas from the South Gashou field will be built for 14 MCM/d.

A plant to treat gas from the Homa field will be built for 12 MCM/d.

Kharg will be the site of a 600 MCF/d gas and NGL processing plant in a $1.3 bn project tendered since 2002 but delayed by the Iranian Offshore Oil Co. (IOOC), another NIOC unit (see background in gmt15IranGasExprtApr11-05).

Iran's most modern gas plant completed in 2005 at Masjid e-Suleyman has the capacity to process 38,000 to 50,000 CM/hour of gas by taking advantage of digital technology without using utility services. The plant refines 1-1.5 MCM/d of gas as well as 700-800 barrels of NGLs for export. Its feedstock is associated gas from Naft-e-Sefid oilfield.

NIGC has three small LPG plants and terminals at Bandar Mahshahr, Kharg island and Bandar Abbas, with a total capacity of less than 600,000 t/y. They were built before the revolution for local use.

The Bandar Imam petrochemical complex, run by state-owned National Petrochemical Co. (NPC), has an LPG plant with a capacity of 1.9m t/y mostly used to produce petrochemicals, which went on stream partly in 1990 and partly in 1995 (see Downstream Trends of this week).

LPG exports were stopped in early 1979. NIOC's LPG marketing division, NILPG, began exporting butane and propane in June 1991. In 1992 it exported 800,000 tons, mostly from Bandar Khomeini's LPG terminal where deliveries were made for the account of NPC. Exports reached 1m tons in 1997 but have since declined considerably due to higher local demand. NPC takes part in NILPG's marketing and in the pricing of LPG, which are somewhat in line with Saudi Aramco's formula.