Iran Oil Terminals Handling Capacity at 28mb/d
Iran is determined to attract domestic and foreign investment in a pipeline project that would deliver its oil from Goureh area to the Oman Sea coasts. That lies within the framework of Iran's longtime strategy to diversify its oil export terminals. This strategy has been pursued by Iranian oil officials since start of imposed war in 1980. During the years of the imposed war, oil storage facilities and jetties in Kharg Island, which were the main arteries of Iran's oil sales, were repeatedly bombed. Iranian officials then decided to envisage a new route for crude oil exports so that such an alternative would be always counted on.
The project for a new route of crude oil export is now expected to materialize under the administration of President Hassan Rouhani. Given the government's concentration on this strategic project and the conclusion of its software affairs, Jask Terminal is largely expected to come on-stream before the Rouhani administration bows out.
Iran, a country rich in both oil and gas, currently exports oil and its derivatives only through Kharg Island. Jask Port, which is off the Indian Ocean, has potential to become an energy hub in Iran. Infrastructure activities are under way at this port and there is need for domestic and foreign investment. This port could be used as an energy terminal for exporting products of oil and gas sector including petrochemicals and liquefied natural gas (LNG). Although Jask is a vital treasure that has been neglected and has been abandoned to its own fate for years, it could become profitable if proper planning is made.
Jask is planned to become the second energy terminal in Iran. Once it has been designed and built as Iran's second strategic terminal, it would be possible to export oil, gas and petrochemicals to the Indian Ocean countries. Geographically speaking, Jask is of high significance because all vessels particularly oil tankers that enter this area would not need navigate in the Persian Gulf and they could easily load oil, gas and other products without having to take a very long route.
Despite tough restrictions and the Iranian minister of petroleum's sensitivity to this project, regular meetings are held every two weeks to monitor the details of the project.
Building an oil export terminal at Jask Port is currently among the most important petroleum industry projects. Minister Zangeneh has insisted on the private sector's financing of this infrastructure project.
One of main objectives sought in the construction of this pipeline and in the development of an oil terminal at Jask Port is to create a safe area for exporting crude oil outside Kharg Island. A terminal in Jask would accelerate oil exports, reduce delivery price and save oil tankers fuel. Moreover, navigation in the Persian Gulf will decline.
Meantime, due to the significance of this project and the delivery of oil through areas where the temperature exceeds 50 degrees Centigrade, selecting appropriate pipes would be of high significance.
An expert team comprising university professors and oil industry professionals conducted a one-year study to introduce a substance for pipes. Alongside time-consuming specialized studies, selecting a contractor who would be able to manufacture this kind of pipes would face tough challenges.
In parallel with the construction of Jask crude oil export terminal, construction of two refineries, a petrochemical plant as well as crude oil storage tanks with a capacity of 30 million barrels is on the agenda.
Since the project is a build-operate-transfer (BOT) one, the necessary credit is required to be provided by private investors from sources other than oil. For this purpose, eight Iranian investors have expressed readiness to fund the project.
All along the 1,000-kilometer Goureh-Jask route, five pumping stations are envisaged to be built. In total, eight stations are planned to be built for the crude oil installations.
Added Significance
So many years have passed since the project for building a terminal in Jask to export crude oil was raised. This project has not lost significance during these years and has even taken up added importance.
Construction of Jask terminal would help Iran access the Sea of Oman for exporting 1 mb/d of crude oil. That would reduce Iran's dependence on the strategic Strait of Hormuz. Currently, more than 90% of oil produced in Iran is exported to foreign markets via Kharg terminal and the Strait of Hormuz which is 38 kilometers away from Ganaveh Port in the Persian Gulf. That is while the experience of the imposed war and arrangements by countries in the region to build alternative routes to the Strait of Hormuz have increased the significance of quick startup of Jask terminal as an alternative route.
Once the Jask terminal is launched, handling the export of 1 mb/d of crude oil would be shifted from the Persian Gulf to the other side of the Strait of Hormuz in the Sea of Oman. This project would cost Iran IRR 4,000 to 5,000 billion, but it would guarantee sustained oil export and enhance oil storage capacity under any circumstances.
Analysts say since Kharg Island enjoys a good geographical position in the Persian Gulf it may seem that the project of transferring crude oil from Bushehr to Jask - 1,000 kilometers farthe- would be uneconomical. But security reasons necessitate the construction of an alternative route for exporting crude oil, particularly when a crisis may happen in the Persian Gulf to block the Strait of Hormuz.
At a time Iran has prioritized the construction and startup of Jask oil terminal, countries like Saudi Arabia, United Arab Emirates and Iraq have already thought of an alternative route for crude oil exports whenever a crisis occurs.