Eight Western European companies are keen to invest in Iran's $2.8 billion Siraf oil refinery project, an Iranian official said, as the country ramps up capacity to reduce is dependence on imports. Iran-OPEC's fifth-largest crude producer - has huge oil and gas reserves but lacks refining capacity, leaving it heavily reliant on imports. Western sanctions imposed on the Islamic Republic over its disputed nuclear programme have also deprived the country of industry technology. "This project has been designed for the current situation," Alireza Sadeghabadi, managing-director of Siraf Refineries Infrastructure Co., said, referring to Iran's self-sufficiency drive. "Of course after the removal of sanctions more foreign companies will be interested in investing in Iran," he said in an interview with Reuters.
Iran and six countries reached an interim agreement in negotiations on Tehran's nuclear program in early April and are working towards a final deal by the end of this month that could see sanctions lifted. Sadeghabadi said an Asian company, which he would not name, and an Iranian company would work together on certain sections of the refinery. "And we will choose from among eight western European companies that want to be involved," he said, declining to name the companies. He did not say how many companies would be chosen. The Siraf refinery project will have a processing capacity of 480,000 barrels per day and will be completed in 38 months, or just over three years. Eight processing plants would be built by private companies, using their own funds, Sadeghabadi said. Iran's oil sales have dropped to around 1 million bpd as a result of sanctions. The Siraf refinery will have the capacity to produce more than 270,000 bpd of naphtha, 140,000 bpd of gasoil, 30,000 bpd of liquefied petroleum gas and 40,000 bpd of kerosene, Sadeghabadi said. Around 60 percent of Siraf's gas condensate would be turned into higher-value naphtha, which is used to produce plastic-based products, he said. The Middle East is being transformed into a major refining hub with other Gulf countries such as Kuwait boosting capacity partly to reduce reliance on imports. Saudi Arabia targets 8-10 million bpd of refined products in coming years from more than 5 million bpd now at home and abroad.