USD2 BILLION, 600,000KM PIPELINE UNDERWAY WITH NATIONAL IRANIAN GAS COMPANY

Iran 2017 | ENERGY | VIP INTERVIEW

TBY talks to Mehdi Mirmoezi, CEO of Pasargad Energy Development Company (PEDC), on becoming a leading petrochemical firm, negotiations with overseas firms, and the post-election outlook.

How will your new vision determine your strategy for the upcoming years?

We recently decided to adopt a new vision, which is to be a leading sustainable energy and petrochemical player offering diversified and high-quality products and services in Iran and the region, and to be recognized as the strategic partner of choice in the energy field in Iran. This vision converts into a strategy based on three pillars. One is to create value, which means finding the right investment opportunities. The second is to be a diversified business with a diversified portfolio of activities. The third is to build strategic partnerships with global players, building new competitive advantages and value propositions for future project execution and future business activities. We just started to implement this new strategy and plan to reach the goals that have been specified in this regard.

How do you create value for your shareholders through your activities and subsidiaries?

We have broken down the energy business into four Strategic Business Units covering the entire value chain, namely upstream, midstream, downstream and power & utilities. Iran, like other countries, will gradually benefit more from added value in the energy sector. Our strategy has been to be present throughout the energy value chain, with help from the capabilities and expertise of our directors. We are well established in different parts of the value chain, such as drilling and well engineering services. Moreover, we are a qualified Iranian E&P company that is an excellent partner for major oil companies that want to develop oil and gas fields in Iran. International oil companies must have a local partner to engage in E&P activities in Iran. We want to be the partner of choice for major oil companies. We are focused on the E&P business in Iran and have signed an MoU for three medium-sized oil fields with NIOC, to study these fields and to enter into tenders or direct negotiations. It is important for partners to know which companies are fully private. Most of the companies are prequalified by the Ministry of Petroleum, or are semi state-owned companies. There are only a few companies that are fully private, and PEDC is one of them. This is one advantage of working with PEDC. Another advantage is that we have the backing of Pasargad Financial Group. Their support makes us a reliable partner for foreign companies from a financial point of view. In addition, we have experienced people gathered in our company, with knowledge of the different segments within the Iranian energy sector. These aspects make us the right partner for international companies and investors looking to come to Iran.

Iran is strategically located in the proximity of some big energy consuming countries. How can PEDC, as a trader in energy products, benefit from this?

PEDC transports oil products between different neighboring countries. We import some oil products from the UAE and Iraq, and export them to Armenia and Afghanistan. Also, we import products from Turkmenistan and export them to Iraq. We have started this business to benefit from our geopolitical situation. PEDC possesses three power plants, located near the borders with Turkey, Iraq, and Afghanistan. We are seeking permission to export power from our power plants and directly export it to neighboring countries. In a few years, there will be opportunities to get involved in the trade of electricity, and we can benefit from our geopolitical situation.

How do you reflect on the negotiations you have had so far with international companies?

In upstream and E&P, the government has prepared a solid ground for having mutual discussion with international oil companies. In power & utilities, we are discussing with South Korean delegations that are interested in investing in power plants. Some investors are seeking long-term partnerships, while others are looking for short or medium-term partnerships, especially in the development of new petrochemical and refinery projects. We are optimistic about our negotiations with different foreign partners and are determined to establish and implement our plans. The E&P business is the gateway for us to enter into long-term partnerships with international companies. It shows the credibility, competitiveness, and reliability of PEDC for possible international partners.

What is your outlook for the year ahead?

After the reelection of President Rouhani, I expect that Iran will continue to develop positive relationships with the world. This will create a more supportive business environment in which we can work and conduct our business. We are going to complete our build-operate-transfer (BOT) project for laying a gas pipeline to export gas to Iraq. We have a project worth more than USD2 billion with the National Iranian Gas Company (NIGC) to build a 600,000km pipeline with five compressor stations for exporting gas to two Iraqi cities: Basra and Baghdad. We are going to complete this project by the end of next year and it will create more value and credibility for us. We aim to sign partnership contracts in the next year with major international oil companies to develop Iranian oil fields. In addition, we would like to enter into partnerships in our petrochemical and refining projects, especially in Siraf, where we have eight plants that each produce 60,000bpd of condensate.

 

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