The Business Year

Abdol Hossein Bayat

IRAN - Energy & Mining

There’s More to Do

Dept. Petroleum Minister & President, NPC

Bio

Abdol Hossein Bayat was born in 1962 and attained a Bachelor’s degree in Mechanical Engineering. He later obtained an MBA from the University of Calgary. He is currently Deputy Petroleum Minister and President of the National Petrochemical Company (NPC). Previous positions include Managing Director and board member of Bushehr Petrochemical Co. and Coordinator of Financial Resource Allocation to NPC projects.

What is your evaluation of the Iranian petrochemicals sector and how would you assess product quality? The quality of petrochemical products in Iran is fully compatible and competitive within national […]

What is your evaluation of the Iranian petrochemicals sector and how would you assess product quality?

The quality of petrochemical products in Iran is fully compatible and competitive within national and international standards. Thanks to the quality of our petrochemical products, our international customers have a huge demand for our range of products. In the last six months, the National Petrochemical Company (NPC) successfully managed to meet all the requirements of the REACH Regulation—the qualification test for European standards—and now we have confirmation to export all of our products to the European market. This is proof that the quality of Iranian petrochemical products is very high, and serves as a good reason why there is such a high demand for them. In order to produce these products, we utilize state-of-the-art technology that improves our output. Iran started producing petrochemical products more than 50 years ago, and over this time we have been able to develop a skilled workforce that is positively affecting our production.

The value of petrochemical products is expected to reach $26 billion by 2015. What strategies is NPC following to contribute to achieving this goal?

It is expected that petrochemical-based products will replace products made out of wood, aluminum, and metal, as well as those made out of minerals, in many sectors. Petrochemical products may also replace certain construction materials. We are looking at different markets, such as those in Asia. According to our research, the demand in that market is growing, and we have access to it. At the same time, we have experts at NPC that do market analysis, and we are directing our production capacity to be able to supply the demand of our neighboring countries and our national market. As an example, we are currently producing 5.5 million tons of urea per year, of which 2.2 million tons is used locally and the remaining 3.3 million tons is exported. Still, the demand is high, and customers often demand 10 million tons of urea—we cannot meet that level of demand yet. Another example is polypropylene output capacity, which is 600,000 tons per year, and domestic consumption actually exceeds our production capacity. This is the reason we import some products to satisfy our increasing domestic demand.

How are NPC and the government assisting foreign investors to enter the petrochemicals industry?

Iran possesses the world’s largest reserves of oil and gas combined. In terms of feedstock diversity, Iran has the most diversified resources. We have access to natural gas, gas condensates, LNG, and naphtha. Given these resources, the strategy is to implement and avoid selling crude products, and instead create value-added products for export. We believe that creating this value-added will attract investors, both domestic and foreign. In order to attract and facilitate foreign investment, we have to protect investors by guaranteeing the highest profit margins. The benefits we offer are access to long-term feedstock supplies, the availability of cheap and abundant land, and infrastructural facilities located in special economic zones that enjoy advantages such as tax exemptions. The other available advantage is that exports can be made without limitations. The security of investments made through the National Development Fund allows investors to use the financial resources of the banking sector, which grants them the possibility to use the local capital markets. NPC and the government will offer guarantees so that investors gain access to the market. Of course, investors will benefit from a skilled workforce with managerial experience, as well as qualified companies active in the fields of engineering, manufacturing, and implementation. In addition, investors will have access to government-built infrastructure, such as the port in the South Pars Special Economic-Energy Zone. This port, for example, has facilities that allow the export of different kinds of gaseous, liquid, and solid petrochemical products.

What is your forecast for the petrochemicals sector?

I am very optimistic, and my optimism is based on facts and figures, as well as the 25 years of experience that I have in the petrochemicals sector. Given the potential that Iran has and the plans and efforts that the government is making to create a lucrative investment environment, I believe that Iran’s petrochemicals industry will boom. Any investor looking to invest in the coming period will enjoy a fruitful return on his or her investment.

ADVERTISEMENT

ADVERTISEMENT

You may also be interested in...

Ata Ghotbi

IRAN - Agriculture

Satisfying Iran’s fast-food hunger

Interview

Chairman, ATA Corporation

Masoud Zarringhalam

IRAN - Energy & Mining

Established just after the ending of the Iran-Iraq War

Interview

Managing Director, Sazeh Pardazi Iran Consulting Engineers Co.

Dr. Mehdi Fazli

IRAN - Economy

Trailblazer

Interview

CEO, Golrang Industrial Group (GIG)

View All interviews