Iran has sold its first consignment of naphtha produced at the Persian Gulf Star Refinery to the UAE as the countdown nears for the operation of the world’s largest condensate refinery.
The cargo of 280,000 barrels of naphtha was delivered to the Emiratis recently, with the second shipment being loaded for export, the Mehr news agency reported on Monday.
There is already a strong demand in Asia for naphtha which is used to produce products such as ethylene and propylene, the building blocks of plastics. Strong economic growth in countries such as India is expected to generate fresh interest in the product.
The exports mark a turning point in the imminent operation of the Persian Gulf Star Refinery. Minister of Petroleum Bijan Zangeneh has said the plant will come on stream in the first half of the new Iranian year which begins on March 20.
The 360,000-barrels-a-day refinery, being built with 3.5 billion euros ($4.7 billion) of investment, is set to turn Iran into a net gasoline exporter.
It will produce around 36 million liters a day of gasoline, with its first phase expected to come online at a capacity to process 12 million liters which will make the country self-sufficient for gasoline. The remaining two phases are projected to start operation by the end of 2017.
The Persian Gulf Star refinery is the most important refining project in Iran, meant to process the condensate from South Pars in Asaluyeh. Condensate is a light form of crude oil produced in association with natural gas.
Despite being a major oil producer, Iran imports gasoline to fill the gap between domestic supply and consumption.
Several dates for the completion of the facility have been pushed back, including in 2014 when Iran was under the harshest US-led sanctions.
Iran expects to add 12 million liters per day of Euro-4 gasoline to its output when the first phase of the Persian Gulf Star Refinery comes online. According to officials, the unit will also produce 4 million liters per day of Euro-4 diesel.
Gasoline production turned into Iran’s strategic vulnerability after the West started imposing sanctions on the country in 2012.