The first refinery which is under construction and uses gas condensate feedstock in Iran is Persian Gulf Star Gas Condensate Refinery. It belongs to Persian Gulf Star Oil Company. The main purposes of establishing this refinery are as follow:

  • Self-sufficiency in producing high quality petrol
  • Refinement of 360,000 barrels gas condensate per day from South Pars reservoirs
  • Production consistent with European quality standards
  • Creating higher value added than crude oil refineries
  • Preventing export of raw materials and as a result, completing the value chain of production
  • More job creation
  • Increase in GDP

Persian Gulf Star Refinery has been setting up in the form of three phases with the capacity of 36 million liters of petrol and 14 million liters of gasoline in accordance with Euro IV standards (the fuel with 35% aromatics, 18% olefins, 1% benzene, 2.7% oxygen and 50 ppm sulfur) which will lead to production of 100 million liters of petrol per day in Iran. However, Iran’s average production of petrol and Euro IV petrol were 74.400 and 25.824 million liters per day respectively in the first eight months of the current solar year. In November 2017, by operation of the first phase of Persian Gulf Star, the production of this refinery has reached to 12 million liters of Euro IV petrol, 4.5 million liters of Euro IV gasoline, 1 million liters of Euro IV kerosene and 1.3 million litters of Euro IV LPG.

At the moment, Iran’s consumption of petrol was about 75 million liters per day in the first six months and 85 million liters per day in the second six months of the year on average during the last few years. It should be noted that, annual petrol consumption growth is about 6-8% per year in this area. According to the reported amount of daily petrol’s production as mentioned earlier, Iran is forced to cover its surplus petrol demand through importing of about 12 million liters petrol per day. The foresaid procedure will continue until the production of petrol at least rise 10 times more than growth in consumption. After that all three phases of Persian Gulf Star Refinery start to operate, Iran can benefit from its different advantages and the main one is achieving self-sufficiency in covering domestic demand beside turning into one of the main petrol exporters in the area.

According to the latest research released by www.globalpetrolprices.com , the average retail price of petrol in the world is about 1.1 Dollars per liter which is different in one country compared to another. Generally, it can be said that lack of development, low income per capita and poor transportation systems usually lead to more subsidies by the government to energy carriers and finally lower petrol prices in the countries. Normal and super petrol prices in Iran are 23.8 and 28 Cents per liter respectively, while according to the Argus Journal, petrol price for Persian Gulf FOB is 43 Cents per liter on average. Setting up of all phases of Persian Gulf Star refinery and following that, export of petrol by Iran can be a great step to higher quality of petrol produced in this country and realization of petrol price in order to maintaining competitive power in the area.

To sum up, operation of phases 2 and 3 of Persian Gulf Star Refinery, as the biggest gas condensate refinery in the Middle East area, will need about 100 and lower than 100 million Euros respectively and therefore considering vast opportunities which are available in this sector, it can be attractive for investors from Iran and also foreign investors.