With the implementation of three oil docks at Shahid Rajaei Port, oil products export capacity from this south Iranian complex will reach 34 million tons, said deputy minister of roads and urban development.
Mohammad Saeidnejad who is also the managing director of Iran’s Ports and Maritime Organization (PMO) said that the oil docks will include three piers to be constructed at a total cost of about $50 million, Shana reported.

The official hoped that two docks will be constructed in 18 months while the third will come on stream within 24 months thanks to the capabilities of Iranian contractors.

On equipping the second terminal at Shahid Rajaei Port, Saeidnejad said, “15 indigenous cranes will be installed in the near future.”
Director of Iran’s PMO noted that design, installation and implementation of the cranes were carried out by an Iranian company thus saving a considerable amount of hard currency and paving the way for exports of manufactured items by domestic firms.
“With a total investment of 21 million, the project is estimated to be completed within 18 months,” he continued.
Earlier in March, 2017, a contract was also signed with the private sector to prepare grounds for exports of petroleum products produced at Persian Gulf Star Refinery through Persian Gulf Special Economic Zone.
Under the terms of the contract, the domestic company will create necessary infrastructures in the next five years to ship 22 million tons of petroleum products to destination markets.
As the main point in North-South Corridor, Shahid Rajaei Port enjoys access to freeway and railway and is adjacent to three major refineries.
According to plans, the Iranian port will undertake a portion of annual exports of oil products from these refineries.

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Executive Director of Iranian Offshore Oil Company Hamid Bovard announced that the oil extraction from the joint Iran-Saudi Arabia oilfield will be increased by at least 12,000 barrels per day.

“The Iranian Offshore Oil company, other than its role to produce crude oil, establishes the presence of the Islamic Republic of Iran in the Persian Gulf,” Bovard said, IRNA reported.

Foroozan oilfield, a joint field between Iran and Saudi Arabia, is located about 100 kilometers southwest of the Kharg Island and the Arabian part of this oilfield is called ‘Marjan’.

This oilfield, with a reserve of around 2.3 billion barrels of crude oil, is mostly placed in Saudi Arabia’s waters and according to the accepted borderline between Iran and Saudi Arabia Iran’s share to obtain oil from this field is 11 percent.

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South Korea‘s intake of Iranian crude oil soared to a record high in March and its first-quarter crude imports from Iran nearly doubled on year, reflecting Tehran’s efforts to raise output after the lifting of sanctions early last year.

The increase in volumes since international sanctions against Tehran were lifted in January 2016 has made Iran the second-largest oil supplier to South Korea after Saudi Arabia, in the first quarter of 2017, reported Reuters quoting preliminary customs data on Saturday.

Iran was fifth-largest in the first quarter of 2016, behind Saudi Arabia, Iraq, Kuwait and Qatar, according to data from Korea National Oil Corp. (KNOC).

The official KNOC data ranked Iran as second-largest for the first two months of the year. KNOC figures for March and the quarter are due out in one week.

In March, the customs data showed South Korea imported 2.26 million tons of Iranian crude, or 534,368 barrels per day (bpd), up 118.8 percent from 1.03 million tons a year ago, reaching a record. That was up 38.3 percent from 1.63 million tons in February.

The world’s fifth-largest crude importer and one of Tehran’s biggest customers shipped in 5.68 million tons of Iranian crude in the first three months of 2017, or 463,234 bpd, up 92.4 percent from the 2.96 million tons imported during the same period a year ago.

Meanwhile, oil shipments from Saudi Arabia to South Kore, rose 10.9 percent to 3.52 million tons, or 831,413 bpd, in March on year. That was down 2.6 percent from 3.61 million tons a month ago as the world’s top oil exporter complies with the OPEC deal to cut supplies.

Organization of the Petroleum Exporting Countries (OPEC) and some non-OPEC members reached an agreement to curb output last year by almost 1.8 mbd in the first half of 2017. Iran was exempted from the deal.

South Korea’s crude oil imports from Saudi Arabia fell 10 percent to 10.44 million tons in the first quarter of this year, or 850,614 bpd, from 11.61 million tons in the previous quarter, but that was 5.7 percent higher on year.

Overall, Asia’s fourth-largest economy brought in 12.68 million tons of crude oil in March this year, or nearly 3 mbd — up 10.1 percent from 11.52 million tons a year ago — according to the data.

For the first quarter of 2017, South Korea imported 36.94 million tons of crude, or 3.01 mbd, up 4.6 percent from 35.32 million tons a year earlier.

Final data for the country’s March crude oil imports will be released by state-run KNOC later this month.

Iran’s Oil Ministry said early this month that the country’s total exports of crude oil and condensates had exceeded three million barrels per day — a level not seen for at least the past six years.

Oil Minister Bijan Namdar Zanganeh said, “The pace of growth in Iran’s crude oil production and exports has amazed international observers who did not think Iran could raise its production by one million barrels per day within three to four months after the removal of sanctions.”

According to the ministry, almost a third of Iran’s oil exports, or over 700,000 bpd, is currently destined for Europe. The country exported around 600,000 bpd of oil to Europe during pre-sanctions years.

A top oil official said last December that Iran had started exports of condensate to Europe by sending a maiden cargo of one million barrels to certain EU clients.

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An NIORDC official has reported on talks between Iran and Japan over implementation of a two-billion-euro project for upgrading Abadan Oil Refinery.

Managing Director of Abadan Oil Refinery Company Esfandiar Daemolzekr informed reportes about the latest development status of and the plan to reduce fuel oil production in the oldest oil refinery of the Middle East saying “in partnership with China’s Sinopec, the plan to equip, develop and upgrade Abadan refinery will kick off as of the new Iranian calendar year (to begin March 21).”

The official recalled that the second development contract was inked with the Chinese side following implementation of the Joint Comprehensive Plan of Action (JCPOA) asserting “the initiative aims to boost profitability and reduce fuel oil production form the current 40% to less than 20 per cent.”

He emphasized that the refinery project required three billion dollars of investment adding “desalination units and those for purification of diesel and kerosene will be also expanded.”

On the third development phase of Abadan refinery, Daemolzekr said about 40 per cent of crude oil is currently turned into fuel oil due to ageing distillation units though reduction of fuel oil output has been put on the agenda.

He underlined that 8000 jobs will be created during five years of developing phase two of the Iranian refinery highlighting that for expansion of Abadan complex phase 4, talks are underway with a Japanese firm and a contract will be inked soon.

He referred to the held negotiations with Japan’s JGC Corporation Engineering company for carrying out the fourth development phase of Abadan Oil Refinery maintaining “the project will require nearly two billion euros of financing and it will reduce fuel oil output to less than 10 per cent.”

The official at National Iranian Oil Refining and Distribution Company (NIORDC) went on to stress that Abadan Oil Refinery began operation about 107 years ago with an initial output of 2700 barrels though its production figure has fluctuated over years.

“The refinery is currently supplying 25 per cent of the country’s gasoline demand,” noted Daemolzekr concluding “Abadan Oil Refinery is presently yielding seven million liters of Euro-4 gasoline and 100LL avgas per day.”

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Iran is making rapid forays into the European crude oil market and selling its parcels to countries such as France, Italy, Greece and Spain, UK-based global shipping consultancy, VesselsValue said.

“Following the removal of sanctions, new players have emerged in the mix,” VesselsValue said in a report. Iran’s crude oil shipments have been delivered to destinations ranging from Malaysia and Singapore in Asia to Syria in Africa, it said, according to Platts.

In 2016, the number of voyages to deliver crude from Iran to France was estimated at 21, while Italy, Greece and Spain took 15, 14 and 13 shipments respectively, it said. This includes shipments in VLCC, Suezmaxes and Aframaxes.

In July 2012, the European Union had banned the import of Iranian crude by member countries and also the provisions of EU-linked insurance, which included protection and indemnity cover for any shipments of Iranian crude, irrespective of destination. The sanctions were relaxed in January last year.

There has also been a significant change in the geographical mix of owners whose ships were used to lift Iranian cargoes of crude.

Prior to the lifting of sanctions, the National Iranian Tanker Company (NITC) was the largest provider of tonnage to load cargoes from Iran, in addition to Iran-o Hind, Idemitsu Tanker, JX Ocean and KLine.

The Iranian ships were provided local insurance cover but there were always concerns over the possibility of any potential liability in event of maritime accidents in waters of importing countries which were permitted to purchase crude from Tehran.

During the period of sanctions, India permitted Iranian ships to call at Indian ports based on Tehran’s local insurance cover, China used ships of domestic companies while the Japanese government provided insurance cover only for VLCCs.

South Korea and Taiwan also took deliveries of cargoes purchased on a cost and freight (CFR) basis.

Now, “the group of shipowners lifting crude from Iran has changed dramatically to include those from Greece and Belgium”, VesselsValue said.

“The influx of owners from Greece has significantly increased the number of Suezmaxes plying on the ex-Iran voyages to 81 last year, compared with 15 in 2015,” the report said.

While NITC continues to be the market leader in terms of the number of ships deployed for loading crude from Iran, other companies with ships loading from the country include Dynacom, Delta Tankers, Euronav, Polembros, COSCO, Avin International, Olympic Shipping and Management, New Shipping and Thenamaris, it said.

Last month, two Iranian VLCCs, the ‘Huge’ and the ‘Snow’ delivered a mix of the country’s heavy and light crude grades to Shell at Rotterdam, according to trade sources and S&P Global Platts.

In late January, Iran’s Oil Minister Bijan Namdar Zanganeh said that the country was producing 3.9 mbd crude and was set to reach its 4 mbd target by the end of the Iranian year on March 20.

This will mark the return of Iran’s output to levels last seen before 2012, when international sanctions were imposed on the country.

A Platts survey released on February 6 estimated Iranian production at 3.72 mbd in January, up 30,000 bpd from December.

While cuts in crude production have been initiated under an OPEC-led agreement, Iran is allowed to boost its output to 3.797 mbd. If this materializes, Iran’s output would exceed its OPEC quota by more than 100,000 bpd.

This is expected to translated into more crude shipments from Iran. According to VesselsValue, the seaborne exports of Iranian crude are rising significantly.

The number of crude laden shipments from Iran increased to 563 last year — up from 66 in 2012 and 277 in 2015, their data showed.

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Iran has zipped past the likes of Venezuela and Nigeria to become India’s third largest oil supplier as easing western sanctions enabled Indian companies to increase purchases from that country.

Saudi Arabia and Iraq continue to be ahead of Iran, which was sixth biggest supplier of crude oil to India in 2015-16, PTI reported on Wednesday.

It has overtaken Venezuela, Nigeria and UAE to become India’s third largest supplier in April-December period of 2016-17.

Iran sold 19.8 million tons of crude oil to India in the nine-month period, officials said. This behind Saudi Arabia’s 30.3 million tons and 29.1 million tons sourced from Iraq.

In full 2015-16 fiscal, Iran had supplied 12.7 million tons of crude oil to India. That year Saudi Arabia had sold 40.4 million tons of oil to India with Iraq chipping in 26.8 million tons. Venezuela supplied 23.6 million tons, Nigeria 23.4 million tons and the UAE 15.7 million tons.

Iran was India’s second biggest supplier of crude oil after Saudi Arabia till 2010-11 but western sanctions over its nuclear program relegated it to the 7th spot in subsequent years.

In 2013-14 and 2014-15, India bought 11 million tons and 10.95 million tons respectively from Iran, officials said.

Easing of western sanctions a year ago has led to Indian refiners raising their purchase from Iran.

During April-December 2016-17, Venezuela supplied 17.5 million tons of oil, the UAE 13 million tons and Nigeria 12.8 million tons.

Kuwait, which was third largest supplier in 2013-14 has steadily slipped, supplying just 7.6 million tons in first nine months of 2016-17 fiscal.

Iran in 2008-09 sold 21.81 million tons oil to India, which came down marginally to 21.19 million tons in the following year. It fell to 18.49 million tons in 2010-11 and to 17.44 million tons in 2011-12.

After the imposed sanctions, India brought down the purchases to 13.14 million tons in 2012-13 and had limited them in the years thereafter.

Officials said India imported 161.7 million tons of crude oil in the April-December period this fiscal, 64.2 percent of which came from the Middle-East region.

India spent $50.62 billion on crude oil imports during the nine months.

January 2017  imports up

Meanwhile, shipping data showed on Wednesday that India’s Iran oil imports rose marginally in January compared to the previous month.

In January, Iranian oil imports more than trebled compared with the same month last year, rising to 554,600 barrels per day (bpd), according to ship tracking data and a report compiled by Thomson Reuters Oil Research and Forecasts.

Indian refiners including Reliance Industries Ltd, operator of the world’s biggest refinery complex at Jamnagar, that had stopped imports from Iran during the sanctions period, have also returned as buyers of Iranian oil.

During January India’s oil imports from Brazil surged to its highest level since April 2015, while imports from Venezuela plunged, almost matching the supplies received in August 2016.

Nigerian oil supplies, hit by militant attack on the African nation’s major Trans Forcados Pipeline, to India fell by 54 percent last month from a year ago.

That forced key Indian clients of Nigeria, mostly state-run companies, to turn to Angola. Imports from Angola rose nearly 70 percent.

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Iran expects to sign its biggest oil refining contracts worth $8.6 billion with a number of Japanese, Chinese and South Korean companies this month or later, an official said on Wednesday.

The biggest deal is reserved for Japan’s Marubeni, Chiyoda and Mitsui companies to upgrade Isfahan refinery, Deputy Oil Minister Abbas Kazemi told reporters in Tehran, Press TV reported.

“Negotiations have been held with the three companies and the deal for this massive refining project worth $3.6 billion is expected to be finalized soon,” he said.

Another $2-billion contract is about to be signed with South Korea’s Daelim to boost oil processing capacity at Isfahan refinery, Kazemi added.

However, the most imminent contract, valued at $3 billion, is expected to be concluded within the next couple of weeks with the Chinese to develop and improve the quality of Abadan refinery.

Kazemi predicted the formal implementation of the project beginning in the current Iranian month, which started on January 21, with the participation of energy officials from the two countries as well as senior directors of China’s SINOPEC company.

The scheme is planned to cut furnace oil production at the plant to about 20 percent from the current 40 percent, the official said.

China has opened $1.3-billion credit line to financier the plan, he said, adding another $1.7 billion is expected to be opened in the spring.

Iran plans to sign contracts worth $14 billion to fix and upgrade the quality of Tehran, Bandar Abbas, Isfahan, Tabriz and Abadan refineries, said Kazemi who is also managing director of National Iranian Oil Refining and Distribution Company.

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NITC head announced that 35 Iranian tankers have been leased out to oil companies in Europe like Spain’s Cepsa and Eni of Italy.

New Managing Director of the National Iranian Tanker Company (NITC) Sirous Kianersi described latest status of oil displacement agreements between NITC and huge European oil companies saying “so far, 35 contracts have been inked with European sides for taking out leases on 35 Iranian tankers.”

The official stated that the 35 lease contracts had been signed with oil giants from various EU states like Greece, Spain, Italy and the Netherlands asserting that the deals were spot contracts which were sealed for transport of crude oil.

He highlighted that Iranian tankers enjoyed highest standards for transference of crude oil in ports and oil terminals of the European Union (EU); “so far, agreements have been signed with majority of European oil firms like Spain’s Cepsa, Italy’s Eni in addition to Greek and Dutch companies.

In view of post-JCPOA conditions and removal of restrictions, more agreements will be sealed with European oil giants for displacement of crude oil, the official reiterated.

Last week, Kianersi had reported on berthing of Iranian oil tankers at EU oil terminals stressing that the first Iranian tanker had tied up at a Spanish socking site.

For the first time ever, an Iranian tanker, which has been lent out to a large Spanish oil company, moored at Algeciras port of the European state.

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A senior Oil Ministry official said Iran is boosting oil production by 90,000 barrel per day in line with last year’s OPEC agreement.

“We are increasing our oil output which will reach the designated production level,” Gholamreza Manouchehri, National Iranian Oil Company’s (NIOC) deputy head for engineering and development affairs told IRNA.

On November 30, 2016, the Petroleum Exporting Countries (OPEC) finalized an agreement to cut its overall production by 1.2 million barrels a day and set its new production ceiling at 32.5 million barrels a day as of January 2017.

The agreement, however, allowed Iran to raise production by 90,000 bpd to nearly four million barrels a day from January this year.

Manouchehri pointed to reports that Iran’s production ceiling has increased beyond the level set by OPEC saying the rise does not run counter to the terms of the agreement.

“Iran’s average oil production must only be below the level set by OPEC in a period of six months,” he added.

The November deal — the first in eight years — also granted Libya and Nigeria, which had seen their production drop due of armed conflict, an exemption from the cut.

Oil has rallied since November amid speculations that the supply cuts would boost prices. Some market analysts say that crude prices could reach $60-$70 a barrel in the coming months if the cuts are fully enforced.

Iran oil market upbeat

Since the lifting of sanctions began in January last year, the Islamic Republic has largely increased oil exports.

Speaking on the first anniversary of the implementation of the Iran nuclear deal in a gathering in Tehran on January 16, First Vice President Es’haq Jahangiri said that the exports of Iran’s oil and gas condensates are at their highest levels since the 1979 Islamic Revolution.

Tehran and the P5+1 — the US, Britain, France, China, Russia plus Germany — signed the nuclear accord known as the Joint Comprehensive Plan of Action (JCPOA), on July 14, 2015.

Under the landmark deal, which went into force on January 16, 2016, the Islamic Republic undertook to place restrictions on its nuclear program in exchange for the removal of nuclear-related sanctions against the country.

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An Iranian oil tanker has called at a European port for the first time since the lifting of sanctions last January, said managing director of the National Iranian Tankers Company (NITC) said.

Sirous Kianersi added the first NITC tanker leased to a major Spanish oil company docked at the Port of Algeciras just recently, reported IRNA on Wednesday.

More NITC tankers are heading to other European ports, he said, adding two vessels are currently en route to the Netherlands.

NITC is the biggest tanker company in the Middle East and one of the largest in the world with a capacity of 15.5 million tons per year.

Managing Director of Iran’s Port and Maritime Organization Mohammad Saeednejad also said on Wednesday that the lifting of sanctions has allowed Iranian ships to fully resume operations to Asian, European and American ports.

Since October, Iranian VLCCs have reportedly completed 32 voyages delivering around 70 million barrels. China accounted for 13 voyages and India for 12 others.

As many as 17 international shipping lines have resumed their calls at Iranian ports which were deserted by and large during the sanctions, Saeednejad said.

Iranian VLCC fleet, which had been used as floating storage, has started to reappear on international trading routes. Since October, more than 20 NITC-operated VLCCs have returned to the market compared to just 13 in October.

Iran’s oil exports hit 2.04 million barrels per day in November, recovering from a decline of around one million barrels per day during the sanctions. Over the last 12 months, European customers have resumed lifting Iranian crude oil, with France, Spain, Greece, Italy, the Netherlands and Taiwan taking at least one shipment.

According to ship tracking data, the number of Iranian VLCCs in storage has fallen from 16 to 7 units, which equals to a reduction of 20 million barrels. As much as 15 million barrels of crude oil is estimated to remain in floating storage on NITC’s VLCCs — down from an estimated peak of between 40 and 50 million barrels.

On Tuesday, a report said global ship insurers were about to resume near full coverage for Iranian oil exports from next month without involving US-domiciled reinsurers.

Restrictions on US firms handling Iranian goods had greatly limited the number of reinsurers of cargoes, but the new arrangements, which essentially allow re-insurance of ships without the involvement of US firms, should boost the number of eligible shipments, Reuters reported.

“There will be no US-domiciled reinsurer participation on the 2017 IG reinsurance program,” the news agency quoted Andrew Bardot, secretary and executive officer at the International Group (IG) of P&I Clubs in London, as saying.

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