Iranmania - 21/5/2006

Iranian Oil Minister said that Arak Oil Refinery Complex's capacity will be increased 10 mln liters daily, IRNA reported.

Kazem Vaziri Hamaneh, on a tour of refining facilities in the province, said the refinery produces about 4.2 mln liters of gasoline daily which with the planned increase in the refining capacity, the figure will exceed 15 mln liters daily.

He said that Iran imports about 20 mln liters of gasoline daily. With the implementation of the plan more gasoline will be produced domestically and imports will be cut down significantly, the oil minister added .

The country's refining capacity is slated to increase to 900,000 barrels daily within the next five years.

"Modernization and renovation of some of the older refineries is on the agenda," he added.

The 90-year old Abadan refinery is the oldest refinery in the country. The complex is undergoing some modernization and repair.

He added that Arak refinery complex will be cofigured to refine heavy fuel to light and airplane fuel.

He said the cost of production, up-keep of transmission and distribution of oil derivatives is approximately rls 16 bln annually.

The plan is to build these new refineries with gas condensate or heavy crude as feedstock. The exact locations of refineries are not definite yet, but will be announced in the near future.

A major problem facing the company is the rising energy use especially gasoline consumption in the country, he said.

He added the plan should be effective in preventing further rise in the rate of gasoline consumption in future years.

Gasoline imports, if the current consumption trends continue, will range $4-4.5 bln by the end of this year.

Gasoline budget shortfall for the first half of the current year stood around $900 mln.

The total refining capacity is 40 mln liters daily where as the gasoline consumption is estimated to exceed 64.5 mln liters daily this year. "Hence, we have to import 24.5 mln liters daily," he added.