Processing Catalysts Commercialized
Pajoohan said: “Many strategic catalysts like processing catalyst are in the process of commercialization. They are produced by the private sector. In most important catalysts, the process of commercialization has already been done or is under way.”
He added: “Most widely used catalysts have been made domestically and in light of catalyst consumption on the long run, it would be possible to win a toehold in international markets.”
In some cases, Pajoohan said, catalyst production capacity is above catalyst consumption capacity. He referred to the production capacity of 1,500 tonnes of methanol catalyst, one-third of which is destined for export.
High Competition in Catalyst Quality
Pajoohan touched on high competition in the quality of catalysts, saying: “For instance, the global price of ethylene and polyethylene varies between 25% and 30%, but in catalysts, this difference reaches 100% to 200%, which is significant.”
He said; “Given the high value of catalyst production, there would be serious rivalry in the quality of these products in the world. Fortunately, when it comes to the domestic production of some catalysts, in addition to appropriate and competitive quality we have special privileges.”
He said: “For instance, copper and zinc are raw materials for the methanol catalyst and Iran is an exporter of these substances. Therefore, we have good conditions to reach proper prices for these raw materials. That could be a good privilege for us.”
Talks with Regional Countries
Asked if Iran had any plans for marketing its catalysts, Pajoohan sad: “Catalysts have big margins. In some high-performance catalysts, the difference in the price of raw materials and final products is between 300% and 500%. Some foreign companies producing methanol catalysts are likely to give us their methanol license, but they will never give the license of their new generation of catalysts to other companies due to the high value of production and their role in the design of methanol production units.”
He said: “In fact catalysts are special and strategic commodities which are largely consumed in our region and there is a high competition over them in the market. Although many factors like price, quality and circumstances are involved in the export of catalysts, we have embarked on talks with regional states including Russia in order to introduce the methanol and polyethylene catalyst. Therefore, we hope that in coming years there would be capacity for catalyst exports. In the near future, it would be possible to export some of these products.”
Knowhow in Processing
Pajoohan said one of major tasks upon PRTC was to provide technical knowhow for production. “Currently we are seriously active in the seven sectors of producing methanol, olefin, high-density polyethylene, polypropylene, ammonia, methanol-to-propylene and methanol-to-olefin,” he said, adding that agreements had been signed to that effect.
“Recently we have been seeking to sign agreements with several companies for licensing. One of the most important issues in this regard is HDPE and polypropylene for which we can present license and engineering documents,” he said.
Pajoohan said: “We claim to be able to develop knowhow in HD, PP and MTP and we have even prepared our engineering documents. However, investment capacity for this sector is limited. For instance, we would need at least $450 million in order to reach stage of propylene production, but Iranian investors do not have such capacity. In fact, limited investment is our main concern in this model of commercial contracts. In other words, a major chokepoint for non-commercialization of our products is this issue.”
“However, we have undertaken follow-up measures and we hope to sign an agreement on HD with a company in coming months. Some companies with investment potential have been identified, but we have to go ahead with more sensitivity in this sector,” said Pajoohan.
No Need for Foreign Consultants
Pajoohan referred to hiring foreign consultants, saying: “We had foreign consultant for licensing HD, PP and MTP, but once sanctions were imposed they quitted. We continued the work and we mastered this technology and we are currently drawing up engineering documents for a 470,000-tonne plant to convert methanol to propylene. The important point is that financing the processing projects by the investor is difficult and building such units would require much capital.”
He said: “The fact is that 90% of the contribution of foreign consultants is the assurance given to investors and persuading a company that has already built plants in the world. Therefore, if we were not under sanctions investors would be willing to have foreign consultants alongside them. But we have to take into account the fact that big companies would never sell their latest knowhow to us and they believe that we should always be one step behind them.”
He said: “Should we fail to develop technical knowhow they will be always producing products of higher quality and lower price forever and they will have their own margins and we should be always after them. Such conditions are not merely for Iran and all countries have similar conditions. Therefore, for qualitative and economic competitions we have to own knowhow.”
Domestic Product Preference
Pajoohan also touched on sanctions, saying: “The sanctions have largely led companies to use domestically produced commodities. If domestic companies just once consume such products, which are similar to foreign ones, they will no longer use foreign products.”
He added: “All our efforts are aimed at leading them towards first-time experience for companies and winning reputation. Branding in this sector is very difficult and time-consuming. Therefore, it would be achieved over years. However, wherever this first-time consumption occurs purchase will go on.”
Pajoohan said the best way and tool of branding would be consumption in manufacturing units and seeing positive feedbacks.
“Meanwhile, there are not many customers in this sector. For instance, if a catalyst is used in a plant we would feel comfortable for its market because the number of complexes is limited and there is good connection between them and the results obtained from unit may be shared with other units. That means the domino-style use of domestically manufactured products. The main part of the job would be to break the first dam,” he said.