Oman Sea, Iran New Oil Destination
Jask Port in southeast Iran is set to handle exporting 1 mb/d of crude oil and storage of 10 million barrels of crude oil. Furthermore, very large crude carriers (VLCCs) of 2 million tonnes would be able to berth at this port. It was only four years ago that Iranian officials decided to develop Jask Port. Remarkable advances have been recorded in the project.
Crude oil exports from the Sea of Oman have always been an ambition of Iranian officials and petroleum industry actors. To fulfil this big wish and social responsibilities and help national and regional development and eradicate poverty in disadvantaged areas, the 12th administration considered building an oil pipeline stretching from the city of Goreh to the city of Jask located 320km east of Bandar Abbas. That would make Jask an energy and industrial hub.
With the implementation of petroleum industry projects in Jask and Makran shores, many other projects could be implemented. Some cases in point are planning for establishing the Jask Special Economic Energy Zone and transforming it into a new energy hub in West Asia, implementing a project to transit natural gas through pipeline to Oman, building crude oil and gas storage tanks, building two refineries and three petrochemical plants by private investment, a power plant, an international airport, developing road and railway transportation along Bandar Abbas, Jask and Chabahar shores, establishing Iran-China industrial park and Jask free zone.
Minister of Petroleum Bijan Zangeneh has said $1.8 billion had been envisaged to be spent for the Goreh-Jask oil project, $700 million of which would be invested in Jask. Furthermore, two refineries have received the nod to be constructed. The next step would be development of the petrochemical sector and gas transmission, said the minister.
Construction of the Goreh-Jask oil pipeline and the Makran export terminal kicked off in July 2020 through videoconference by President Hassan Rouhani.
The Goreh-Jask pipeline has had 80% progress.
Oil Export via Persian Gulf, Oman Sea
Owing to the 80% progress made in the Goreh-Jask pipeline and the operation of the single-point mooring of this project in the final days of last calendar year, Iran is expected to see oil exports via the Persian Gulf and the Sea of Oman together this calendar year.
There were also reports on the completion of welding on 1,000km of the pipeline. Tests show that through construction, significant qualitative supervision was exercised on the process of manufacturing of billets and sheets for pipes.
Pumping Station No. 2 of Goreh-Jask Pipeline is in the pre-commissioning phase. All activities are under way for the injection of oil from Goreh into the pipeline, as soon as possible.
Storage Facilities
Iran’s petroleum industry has been struggling with unilateral sanctions mainly from the United States for more than four decades now. However, it has tried its best to push ahead with its oil and gas production plans. Therefore, in every small and big project, it tries its best to win the confidence of domestic manufacturers and increase its share of self-sufficiency in the petroleum industry equipment. To that effect, domestic companies and manufacturers have been given the major share of crude oil transmission and storage in the Persian Gulf.
According to plans, 20 storage tanks, each with capacity of 500,000 barrels, would be built in Jask to allow for the storage of 10 million barrels of crude oil. A build-operate-transfer (BOT) agreement signed with Omid and Petro Omid investment companies, two storage tanks are expected to be delivered by June.
The first SPM with a capacity of handling 7,000 cubic meters per hour of light and heavy crude oil and gas condensate was launched in the Jask terminal in Hormuzgan Province. This offshore structure weighs about 800 tonnes. The operation of the SPM that has been designed, built and installed by Iranian Offshore Engineering and Construction Company (IOEC), would enable us to load light and heavy crude oil and condensate on VLCCs for export. The project includes about 2,000km of pipeline, five pumping stations, gauges and mechanical equipment, storage facilities and an export terminal.
One of the requirements of the petroleum industry in recent decades has been to develop domestic manufacturing of petroleum industry equipment and to reduce dependence on imports in light of politically motivated pressure and restrictions. Although the issue has been the concern of all administrations, the 12th administration was particularly engaged in it, and therefore it took big steps towards its materialization. In various sectors of the petroleum industry, including oil pipeline and telecommunications, the focus has been on domestically manufactured equipment.
Throughout building the Goreh-Jask crude oil pipeline, the petroleum industry is determined to fully support domestic manufacturing and bring its share to 100%. This project would spare the country more than €200 million and bring about business prosperity for domestic manufacturers.
Amin Ebrahimi, CEO of Khuzestan Oxin Steel Co. (a pipe supplying company), said: “Khuzestan Oxin can manufacture 1.05 million tonnes of wide sheets. Under the aegis of effective support from National Iranian Oil Company (NIOC), Ministry of Petroleum, upstream and downstream sectors, it has managed to develop technology for API sheets.” As the sole manufacturer of wide sheets in Iran, Khuzestan Oxin started working in the sector in 2009. It is a leading company in the manufacturing of these sheets for the petroleum industry.
Less Congestion at Hormuz
Access to oceans and high seas, proximity to Indian Subcontinent nations and the big markets of India and China, the North-South Corridor connecting Central Asian nations, Russia and Afghanistan to high seas and the Indian Ocean, proper sea depth, beautiful and diverse beaches, strategic and geopolitically unique position, attractiveness and openness to investment, implementation of economic and development projects; as well as proximity to the Persian Gulf as a major source of oil and gas are just part of unique advantages to have convinced Iran to build its second oil export terminal.
Kharg Island is currently the only oil export terminal in southern Iran. Therefore, a more strategic terminal for oil export has been always needed. Jask was chosen as the second terminal. That would reduce congestion of oil shipment through the Strait of Hormuz.
Therefore, a second oil terminal was decided to be built in Jask Port with a daily capacity of 2 million barrels. According to plans, 1 mb/d will be transferred via the pipeline connecting Khuzestan to east of Iran and another 1 mb/d will be carried by the Neka pipeline to Jask for swap.
The Jask terminal will have a storage capacity of 20 million barrels of crude oil. In the offshore sector of this terminal, three SPMs will be installed to carry oil to tankers for export.
Commercial ports and oil export terminal in Jask would make routes more secure and more economical. The route taken by tankers for exporting Iran’s oil will become 2,400 miles shorter, while international vessels will run 600 miles less than going to Dubai.