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Winter crunch is forcing the Iranian government to reduce ethane gas allocations to petrochemicals companies.
As winter kicks off, ethane gas allocations to Iranian petrochemicals companies are subject to reduction due to the fierce weather conditions impacting the Islamic Republic. The Iranian government tends to rechannel the ethane gas from petrochemicals plants towards domestic usage.
This situation forces petrochemical companies to switch to liquid or other lighter feedstocks.
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“We use ethane of course, but fortunately our plant runs also with other feedstocks such as light ends, raffinate, C5, LPG, heavy aromatic, C3+, C5+, styrene, and acrynotrile,” explains Mohammed Reza Eftekhari, head of production control and planning at Jam Petrochemical Company.
“So, when we have a shortage in the winter we can switch to other feedstocks,” he adds.
The firm receives 707 000 t/y of ethane feedstock from the South Pars, and 267 000 t/y from Pars Petrochemicals Company.
The cost of the ethane feedstock the company receives is US$16 per metric tonne, while for the liquid feed it is calculated according to specific formula benchmarking the naphtha prices in the Arabian Gulf minus 5%.
Phased Development
Due to the extent and the time differences among the projects, JPC plants are divided into two phases.
“The first phase of the project includes an ethylene plant. Our ethane cracker produces 1.321m t/y per year, making it the largest single ethylene plant in the world,” says Eftekhari.
“We also produce 300 000 t/y of propylene, 900 000t/y polyolefin including 300 000t/y of LLDP, 300 000 t/y of high density polyethylene and around 300 000 t/y PP plus an additional 443 000 of MEG,”
he explains.
The company also produces raffinate, gasoline and other products. The commissioning operation of the Olefin unit was completed on January 2008. The second phase of the project will include an alfa-olefin plant, a butadiene plant, an ABS plant, BDO/THF plant, and butane-1.
The company uses several international technology licences to operate its plants. “We use Technip technology for olefins, Shell for MEG, Spherolene technology for the PDH swing plant, Spheripole for the PP plant, Hostalen for HDPE plant from Lyondellbasell, and Lurgi technology for the butandiol plant,” Eftekhari explains.
Financing its expansion projects isn’t posing a problem for the company. “It is not an issue for us, as we rely on our internal sources to finance our expansion plans,” the executive adds.
Jam Petrochemicals currently has no gateway to the US market due to a rigorous trade embargo, but European markets remain strong for its products. “We definitely see Europe, China and Turkey as our main markets, in that order,” says Eftekhari. “India and Pakistan are also growing clients,” he adds.
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