Amidst the expected lifting of UN sanctions against the country, gasworld business intelligence explores a possible driver for growth within Iran’s industrial gas sector.
Iran has been the subject of varying degrees of international sanctions since its nuclear programme became public in 2002, perhaps most notably the UN Resolution 1696 of 2006 that was imposed after Iran refused to suspend its uranium enrichment programme.
A resolution was announced in mid-July, however, for the end of many of these sanctions in exchange for limits to Iran’s nuclear capabilities. It comes after almost two years of negotiations and sees Iran pledge to allow international monitors to inspect its facilities for the next 10 years, in addition to a number of other measures.
The resolution has, last week, been approved by both the UN Security Council and the European Union (EU), with the latter putting in motion the lifting of its own sanctions – including prohibitions on the purchase of Iranian oil.
The Linde Group is among a number of European companies reported to be interested in reviving their presence in Iran’s petrochemicals sector. Linde did have a sizeable presence in the country, but exited the country in 2010 under political pressure to leave Iran from countries in the West.
gasworld Business Intelligence believes that the industrial gas market in Iran reached revenues of $280m in 2014, up from around $90m in 2004. One of the major identified drivers for growth for the industrial gas business in the country could be the conversion of captive operated production facilities, to onsite projects operated by traditional industrial gas companies.
This trend has been witnessed in many other similar markets, where the petrochemical and steel industries contribute highly to the economy.
gasworld Business Intelligence has identified over 100 captive production facilities in Iran, with total production capacity dwarfing that of commercial production facilities operating in the country. If these facilities were to all be converted to onsite projects, the market could hypothetically generate revenues of over $1bn.
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