Central bank of Iran’s report for year 2014 shows that %15.3 of the country’s GDP is share of oil value added. In Recent years investing in this market has been decreased but after lifting sanctions, due to the great reserves of oil and gas, it will be an attractive market for foreign investors.
Iran has 102 oil and 43 gas fields, 78 of these fields is active which 62 number of them is located onshore and the other 16 is offshore.
Before the sanctions Iran was the 4th largest producer of crude oil in the world. Iran’s definite crude oil reserves are appraised at 137 billion barrels, which is 8.5% of the world’s reserves. Iran also has 1,045 trillion cubic feet of natural gas reserves, comprising 17% of the world’s reserves. Iran’s gas and oil products are mostly liquid gas, fuel oil, gasoline, white oil, and naphta, clearly showing that Iran has the capability of producing chemical products. The existence of crude oil reserves, access to open waters, as well as an existing framework for transportation and export, suggest excellent opportunities for this industry in Iran. One of weaknesses of Iran’s Oil industry is, sanctions make it difficult for the country to utilize foreign capital and high-tech expertise freely employed in other markets, making the development of many of its fields, such as the South Pars field, difficult and slower than initially planned. Iran has 10 active refineries which their capacity is 1,781 thousands barrel per day, all refineries except Abadan refinery is listed in Tehran Stock Exchange. Abadan Refinery is the major producer of fuel oil and liquid gas. In producing oil gas Isfahan refinery has the major share. Arak refinery is the biggest producer of gasoline and the Tehran refinery has the greatest nominal capacity of Kerosene. At the moment, Iran refineries average ratio of real to nominal capacity is 0.96. Top 5 companies in Iran’s oil product industry is shown in table 1. The average P/E ratio in oil products industry is 5.07x.
Table 1: 5 Top Companies in Iran’s Oil Products Industry
|Company Name||Symbol||Market Value ($)||Percentage of Industry|
|Bandar Abbas Oil Refinery||PNBA1||3,208,863,158||32.0%|
|Isfahan Oil Refinery||PNES1||1,406,315,789||14.0%|
|Tehran Oil Refinery||PTRZ1||1,012,535,017||10.1%|
|Tabriz Oil Refinery||PNTB1||721,645,517||7.2%|
Oil industries return from 2006 to 2015 is shown in figure 1. From 2012 market return has increased.
Source: Tehran Securities Exchange Technology Management Co.