Iranian petrochemical privatisation is gaining momentum

A senior petrochemical industry official said that several major petrochemical units will be privatised in coming months, stressing that foreign companies would be authorized to purchase shares and participate directly in the projects.
Mohammad Reza Nematzadeh, managing director of the National Iranian Petrochemical Industries Company, said Shiraz, Razi and Khorasan petrochemical companies will be privatised in the near future, adding that shares of more companies will be offered on the stock market once these three companies are fully privatised.

The official further noted that the pricing mechanism for petrochemicals in Iran does not follow the rapidly changing prices on the international markets, stressing, however, that domestic and international prices of the products should not differ much.
Nematzadeh, who is also a deputy oil minister, said $ 1.7 bn worth of petrochemicals was exported in the year to March 2005, adding that projected revenues for the period was set at $ 1.8 bn. Hepredicted that earnings from petrochemical exports will reach $ 3 bn in the year to March 2006, stressing that the company is involved in a high-profile tender to buy a major European petrochemical firm.

Iran’s petrochemical industry has grown rapidly in recent years. However, experts say although the Management and Planning Organization has directed the industry to make maximum use of domestic capacities in implementing petrochemical projects, the sector would need to work more closely with foreign parties if it is to develop properly.
This is while only two major petrochemical projects have been implemented in partnership with foreign companies in recent years. Iran will rank 35th in terms of global petrochemical production by March 2006 once 15 refineries become operational in the southern hydrocarbon-rich region of Asalouyeh in the coming months.