Iran To Reduce Fuel Oil Output, Up Quality at Bandar Abbas

Iran says the sulfur content of the fuel oil will be less than 1 percent

Nine months of negotiations with numerous international firms has led to Iran signing a memorandum of cooperation to reduce fuel oil production at Bandar Abbas oil refinery – a move that will see a dramatic reduction of fuel oil output and increase in quality, according to local media.

The MoC was signed by Bandar Abbas Oil Refining Company and a consortium comprising Japanese and Iranian companies, and it will see a reduction in the share of fuel oil from the current 30 percent to less than 10 percent – which regional news agencies say marks one of the key policies pursued in Iran's crude refining industry in the post-JCPOA era.

Moreover, Hasehm Namvar, managing director of Bandar Abbas refinery, says plans are in place to increase production quality as fuel oil output reduces: "upon implementation, the volume of fuel oil production will drop to less than 10 percent with sulfur content of below 1 percent."

Namvar added, "the final stages of feasibility studies and provision of technical and economic justification reports are in progress."

According to the managing director, the research phase of the project is being handled in partnership with foreign companies: "talks were held with Japanese, Korean, and Chinese companies while the MoC was finally sealed with a consortium comprising Iranian and Japanese firms."

To date, seven agreements and contracts have been signed for projects to reduce fuel oil production in existing refineries.

Strictly in terms of negotiations with other countries, Iran's effort to reestablish itself on the international market continues to be impressive, and arguably its biggest move came in July, when it announced it was in talks with Japan's Mitsui Chemicals and France's Total SA to attract $60 billion in foreign investment.