Iran’s Oil Revenues Are Falling, and the Regime is Trying to Find New Sources of Income

By The Free Iranian Staff


A list of the biggest petrochemical projects in Iran, where construction or completion of the projects have been delayed or disrupted due to water shortage, has been compiled.

The list is based on the Iranian media reports, traders and project managers, major shareholders and companies’ managers.

This list reveals Tehran officials’ mismanagement and destructive plans for use of the county’s oil and gas resources.

  1. Khorasan Petrochemical Company – According to Tamin Petroleum and Petrochemical Investment Company (TAPPICO), a major shareholder in Khorasan Petrochemical Company, the establishment of the second phase of the company which aimed to produce 660,000 tons of urea and 40,000 tons of melamine a year, has not advanced due to a lack of sufficient water supplies.
  1. Kermanshah Petrochemical Industry – The expansion of this plant to produce 120,000 tons of propylene per year has been halted. Propylene is the second most used feedstock in petrochemical industries in the world. The project manager has told Reuters that, the project has all the necessary licenses and the project was supposed to be launched in 2018, but so far the project is only 30% complete and would now be finished in 2022.
  1. Firouzabad Petrochemical Project, Related Industries – This project to produce $500 million ethylene per year, was planned more than a decade ago and has stalled now. Fasa Petrochemical Company and Darab Petrochemical Company own 30% of Firouzabad Petrochemical Company; the project manager said that “the studies had not properly assessed water needs and the project is unfinished due to water shortage.”

Jahrom, Darab, Estahban and Fasa Petrochemical Companies, which had planned to use the ethylene output are also at a standstill.

  1. Golestan Petrochemical Plant – There is still news about the opening of the plant, twenty years after purchasing a lot (piece of land) to get the Golestan Petrochemical Plant off the ground. The project manager blamed the failure to secure water supplies in an interview with the regime run radio and TV networks. The plant was designed to produce 677,000 tons of ammonia and more than 1000 tons of urea a year.
  1. Koohdash Petrochemical Plant – Seven years after the official launch, according to Tasnim news agency “the project site is an empty lot surrounded by a fence.” Koohdasht Petrochemical Plant was designed to have annual production of 11,000 tons of isobutane, 80,000 tons of 2-ethylhexanol and 45,000 tons of ethylene. A trader linked to the project said a failure to secure water supplies, as well as difficulty accessing feedstock had caused delays.
  1. Dena Petrochemical Plant – The farmers whose farms are located near the Dena Petrochemical Plant are extremely worried about the negative impacts of this project (plant) on the water sources of this region. According to IRNA news agency, 85% of the water consumption of Kohkilouye-Boyerahmad province is used in agriculture, 12% in household and 3% in the industry sector. The government wants to change the water consumption pattern; however the Dena Petrochemical Plant project needs 15 million cubic meters of water a year and has caused widespread protests by farmers.
  1. Khomein Petrochemical Plant – Water scarcity in Khomein, Markazi province is a serious problem, but the government was adamant in braking ground to start a petrochemical plant. The plant planned to use the feedstock from Isfahan and Shazand refineries tp produce 185,000 tons of polypropylene a year.
  1. Phase 2 of Shiraz Refinery – The second phase of shiraz refinery which is located near Bamou National Park in the north of Shiraz, was to refine 120,000 barrels per day. The widespread opposition from residents and environmental activists caused a delay in the $1.5 billion project, however local lawmakers have said it must not be moved out of Fars province.
  1. Isfahan Refinery – Isfahan oil refinery, which relies on drawing 8 million cubic meters of water from the Zayandeh Rood (river in Isfahan) , has struggled to secure its needs due to drought. The refinery’s CEO, Heshmatollah Ebrahimi said in 2018, the 50% of the refinery’s capacity would be shut down if a long-term solution was not found.
  1. Abadan Refinery – Abadan refinery, one of the biggest refineries in Iran, had to temporarily shut down in 2018 due to damages to water pipes. According to the refinery’s public relations, the damages to the pipes are result of falling level of Karoun river and rising salinity; on the other hand, the rising salinity of Karoun river has been caused by the construction of a dam in a salt valley in the riverbed.
  1. Shazand Petrochemical Company – The company had to drill deep wells to access groundwater, regime run IRNA news agency reported, this process has alarmed experts and environmental activists. One of the company officials has told Reuters that they are seeking a contractor to develop a 10 million Euro project to recycle the sewage water from the urban centers.


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