PSEEZ Runs Dozens Petchem Plants, Refineries
Pars Special Economic Energy Zone (PSEEZ) is well known to everyone in Iran and abroad. This zone, which has high potential for investment, has won fame due to supergiant offshore South Pars gas field which Iran shares with Qatar. The zone is able to guarantee energy supply security for industrialized countries in coming years.
Until 1990s, PSEEZ and Assaluyeh were totally unknown and there were several sparsely-populated villages on the map. But today, owning to petroleum industry activity in Assaluyeh, this zone has turned into a county. PSEEZ is also a source of wealth for Iran.
In order to learn about the latest developments in this zone, Iran Petroleum has interviewed Mehdi Yousefi, CEO of PSEEZ.
Q: To begin, would you please tell us when PSEEZ was established and what activities are currently under way there?
A: As a body tasked with providing the infrastructure for the development of the country's largest gas field, PSEEZ is experiencing its 18th year of establishment. A total of 24 standard phases of South Pars as well as dozens of petrochemical plants in phases 1 and 2 are under construction or in operational here. In Phases 2 and 3, gas and gas condensate refineries as well as petrochemical plants are under construction or in operation. In phases 1 and 2, 31 petrochemical plants are active. Of them, 15 are producing products and the rest are in different stages of design, construction and operation. For instance, Marjan, Takht-e Jamshid and Bushehr petrochemical plants are set to come online soon.
Q: Over the past years, and specifically during the three years since the 11th administration took office, how much investment has this zone attracted?
A: Over the past three years, major investment projects have been under way in this zone. One of the most significant ones is Siraf refining park which would convert 480,000 b/d of gas condensate to naphtha. Kangan Petrorefinery Plant, which separates ethane in Phase 12, is another one. A total of $4 billion is estimated to be invested in these two projects.
Q: What about investment in downstream and petrochemical sectors?
A: Investment has been done in other projects at this zone over the past two years. A point in the Resilient Economy is to distance ourselves from selling raw materials and supplying products of low value-added. Gas and gas condensate prices do not stand high and petrochemical products are categorized under middle distillate products whose value-added is not high. For this reason, we have allotted more than 1,000 ha of land to projects which would convert petrochemicals to downstream products. In this sector, 11 projects have been approved and allotted land. Construction operations have begun for some of them including ethylene-glycol to PET conversion and production of propylene derivatives. They are valued at IRR 110,000 billion.
Q: What has PSEEZ done so far to speed up the activity of companies operating in the zone?
A: One of costly and time-consuming issues regarding overhaul of refinery and petrochemical equipment in the zone has been the absence of skilled repair posts. In order to save time and costs for reparation of equipment and subsequently supplying more products in the zone, we will soon launch in collaboration with the private sector a repair complex for rotary equipment. Fresh water supply to the zone is also of high significance. That is why in cooperation with the Ministry of Energy and under the aegis of the Ministry of Petroleum we are seeking to enhance fresh water production capacity.
Q: A major cause of concern in this zone has been the pollution of air. What have you done in this regard?
A: Today in this zone, no development project is envisaged without considering people and the environment. Today, the major cause of concern shared by us and people in PSEEZ is the issue of the environment. That is why we have tried our best to reduce gas flaring in the zone. In 2008, more than 56 mcm of flare gas was burnt per week at PSEEZ. Now, this figure has been cut to 5 mcm due to modifications in the refining and petrochemical systems and also operation of steam recovery units. These activities along with others are pursued and monitored at the Supreme Committee of the Environment. Due to regular monitoring, the flow of flare gas has been halved in these phases and is set to fall further in the near future. Meantime, we are looking for sustainable development in the zone in order to return the flare gases to the refining cycle. Mechanized storage of sulfur produced at refining plants in South Pars is a significant step towards containing air pollution in the zone. The mechanized storage site in the zone has capacity to stockpile 120,000 tons of sulfur. Sulfur is transferred by conveyor for exports.
Q: How many people are active at PSEEZ?
A: Currently, there are more than 61,000 people working at PSEEZ. They include 10,000 in gas refineries, 20,000 in refining plants and more than 30,000 in under-construction projects. Thirty percent, equaling 18,000 people, are local residents. This is the case while three years ago local residents had a 22% share in PSEEZ employment. Plans are under way to raise the share of local manpower in the zone to more than 50%. In order to reach this figure, there has been sufficient cooperation with the provincial Technical and Vocational Organization in order to boost the skills of local manpower.
Q: A plan under way by the Iranian Ministry of Petroleum for oil and gas zones is to provide welfare and social services to local residents. What plans have so far been implemented or are to be implemented in this regard?
A: Increasing welfare for manpower working at this zone and their family has been taken into consideration by the Iranian government and Ministry of Petroleum. According to the latest conclusions of joint meetings with relevant officials at Iran's Ministry of Petroleum, it has been decided to build residential parks in cooperation with the Ministry of Roads and Urban Development and the private sector in the zones abandoned in phases 1 and 2 of South Pars. For instance, construction of 7,000 housing units and related infrastructure will soon begin with the Ministry of Petroleum guarantee. In cooperation with the Ministry of Health, the Ministry of Petroleum recently launched the MRI ward of Kangan Hospital. Furthermore, a hospital in the city of Dayer was inaugurated during a provincial visit by President [Hasan Rouhani]. It cost IRR 110 billion. During provincial visits to Bushehr Province by President, more than IRR 6,500 billion has been earmarked for the petroleum ministry infrastructure projects.
This zone also enjoys good tourism potential. We are currently building a tourism and recreational complex in cooperation with Pasargad Non-Industrial Operations Company. There have been arrangements so that this complex would be connected to Kish Island and Bushehr County via sea.
Q: Would you please provide data about oil and non-oil exports from this zone over the first seven months of the current calendar year (which started in March)?
A: During the past seven months, we exported around 20 million tones of commodities worth $9 billion from PSEEZ, which showed 37% growth in weight and 19% growth in value from the year before. Exports in the calendar year 1393 (March 2014-March 2015) totaled 21 million tones. We also witnessed a 65% growth in gas condensate exports and an 18% growth in non-oil products' exports. Furthermore, 10,000 tons of commodities worth $62 million are imported into the zone per month. Compared with previous years, this figure has been on the decline.