Bandar Abbas to Produce Euro Quality Gasoline

Deputy oil minister has announced the implementation of a plan to improve the quality of gasoline, adding one of the biggest gasoline production projects will come on stream soon.

Outlining the plan, Ali-Reza Zeighami said, “With the construction of an underwater pipeline to conduit super light crude from Hengam oilfield to Bandar Abbas refinery, the quality of gasoline and other oil products from the refinery will improve significantly,” Mehr News Agency reported.

Located between Iran and Oman in the Strait of Hormuz, Hengam oilfield produces one of the lightest crude in the world with a gravity of 42 degrees API.

The American Petroleum Institute gravity index, or API gravity, is a measure of how heavy or light petroleum liquid is compared to water. If its API gravity is greater than 10, it is lighter and floats on water; if less than 10, it is heavier and sinks.

The quality of crude oil is determined in accordance with API degree. Oil with API gravity between 40 and 45 commands the highest prices.

With the implementation of the plan, some 10,000 to 15,000 barrels of super light crude will be refined in Bandar Abbas refinery, Zeighami said.

He referred to reduced transportation costs and lower oil tankers’ demurrage as the distinct features of the project.

“With the construction of the pipeline, traffic of oil tankers (which transport crude oil to Bandar Abbas refinery) in the Strait of Hormuz and the Persian Gulf will decrease significantly.”

Currently, the basket of Iran’s crude oil export comprises of seven types of light, heavy, and super heavy. With the inclusion of oil from Hengam field, as the country’s lightest oil, the basket will be diversified.

Gasoline Projects

Zeighami stated that the first phase of the plan to develop Bandar Abbas refinery will be inaugurated in the near future.

“With the full commissioning of this plan, 4.5 million liters of gasoline compliant with Euro-5 standard will be added to the country’s daily production capacity,” he noted.

The Euro-5 is one of the European emission standards which define the acceptable limits for exhaust emissions of automobiles. Emission standards are defined in a series of European Union directives staging the progressive introduction of increasingly stringent standards.

Also, the gasoline production project in Abadan refinery, which aims at daily production of six million liters of gasoline with the octane number of 93, is expected to come on stream soon.

The project will make possible the production of propylene, reduction in the volume of sulfur in refining products, and a 45-thousand-barrel increase in refining capacity.

Meanwhile, Managing Director of Tehran Oil Refinery Mohsen Qadiri said earlier the refinery will begin producing gasoline compliant with the Euro-5 standard by October.

Tehran Oil Refinery will improve the quality of its products by reducing the amount of sulfur and other pollutants, Qadiri said.
Last December, Qadiri announced that about one billion US dollars had been invested in the project.

Chinese Participation

Zeighami, who is also managing director of the National Iranian Oil Refining and Distribution Company (NIORDC), said negotiations are underway with a Chinese company to invest $7 billion in the development projects of Isfahan and Abadan refineries.

The projects are aimed at producing some 13 million liters of gasoline, about 17 million liters of diesel, over 4.5 million liters of oil, and 3.6 million liters of liquefied petroleum gas.

According to oil officials, Iran plans to increase gasoline storage capacity from the current figure of 11.5 billion liters to 14.5 billion liters by 2015 and to 17.5 billion liters by 2025.

Meanwhile, Deputy Oil Minister Ahmad Qale’bani said earlier the country would raise its crude oil production by more than 100,000 barrels per day by March 2012.

Masjed Soleiman, Yadavaran, Mansouri and Hengam oilfields are the four main drilling projects which will contribute to the increase, he added.

Earlier in April, the National Iranian Oil Engineering and Construction Company (NIOECC) announced that with the commissioning of seven ongoing projects undertaken by the company and the private sector, Iran’s gasoline output will increase four-fold from the current 42 million liters (11.09 million gallons) per day to 186 million liters (49.1 million gallons) per day.

The Islamic Republic has the world’s second-largest crude reserves after Saudi Arabia and the second-largest gas reserves after Russia.