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CNPC pulls out from USD4.8 bil Iranian gas project

October 08/2019

MOSCOW (MRC) -- China's CNPC has pulled out from Iran's USD4.8 billion South Pars gas project, Iran's oil minister said on Sunday, after France's Total abandoned the deal last year amid looming US sanctions on Tehran, reported S&P Global.

Iran's Petropars will now develop the Phase 11 of the gas project, which was signed in 2017. CNPC was supposed to take Total's 50.1% stake in the project on top of its initial 30% share.

"The phase 11 of South Pars gas field has been decided. Petropars alone will continue development of this phase," Bijan Zanganeh was quoted as saying by the ministry's Shana news service.

"Yes, it has stepped aside," Zanganeh said when asked if the Chinese company had pulled out of the project.

Total left the project last year as the US re-imposed sanctions on Iran after Washington pulled out from a nuclear deal with Tehran.

The project is aimed initially at meeting domestic gas demand, with potential for exports in later years. Production capacity is forecast at around 2 Bcf/d of gas, coming on stream in 2021. When fully operating, the scheme is also expected to deliver around 70,000 b/d of condensate.

Zanganeh said that the Iranian contractor will install the first jacket in phase 11 by March in addition to a platform with gas extraction capacity of 500 MMcf/d.

When asked why Iran had not abandoned the CNPC deal after Total's pull-out, Zanganeh said: "We wanted to attract foreign investment for this phase. In addition, the pressure boosting platform was important for us and Petropars was due to learn the job alongside these companies."

Iran shares the giant offshore South Pars gas field with Qatar, where it is called the North Field.

As MRC wrote previously, in October 2018, CNPC started operating an expanded refinery in northern China with an annual processing capacity of 10 million tonnes (200,000 barrels per day). CNPC also added a refined fuel pipeline connecting Fushun and Jinzhou, both in northeast Liaoning province, and a separate pipeline linking Jinzhou with central Chinese city of Zhengzhou. The state firm operates two refineries in Jinzhou.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polyprolypele (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,255,800 tonnes in the first seven months of 2019, up by 9% year on year. Shipments of all PE grades increased. At the same time, the estimated PP consumption in the Russian market was 796,120 tonnes in January-July 2019, up by 11% year on year. Shipments of PP block copolymer and homopolymer PP increased.


mrcplast.com
Author:Margaret Volkova
Tags:PP, PE, crude and gaz condensate, PP block copolymer, homopolymer PP, propylene, ethylene, petrochemistry, CNPC, Total Petrochemicals, Iran, China, Russia.
Category:General News
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