Speaking exclusively at the gasworld Middle East Conference in Dubai, Iran’s Iraj Ghorbani described the ‘unique opportunity’ that his country has in the global LNG market.
With some of the largest natural gas reserves in the world, Iran is ideally placed to position itself at the forefront of the LNG business in the future.
And Ghorbani, Managing Director of Iran’s leading industrial gas company Delvar Afzar, believes that the continual fresh discovery of reserves highlights the country’s potential strength in this future fuel market.
“As everybody knows, by having 34 trillion cubic meters of natural gas reserves, Iran is the second biggest country in the world for natural gas resource, after Russia.”
“This is unique chance for our country to somehow develop this market - and actually these reserves of natural gas have increased in recent decades. Every day we are facing a new reserve and during the last three decades there has been a 230% increase in reserves, or discoveries of reserves, in Iran.”
From a domestic point of view, Ghorbani explained that Iran has more than 30,000km of transmission pipeline and a network of up to 125,000km of gas distribution pipeline. With such healthy reserves to draw upon, consumption of natural gas in Iran is actually 69% of the total energy consumption in the country. The majority of this internal consumption is via pipeline.
“This is unique chance for our country to somehow develop this market - and actually these reserves of natural gas have increased in recent decades. Every day we are facing a new reserve and during the last three decades there has been a 230% increase in discoveries of reserves.”
In terms of export however, Ghorbani pointed out that Iran has considered a number of different approaches to the transmission of natural gas through pipelines and conversion to LNG. In fact, a pipeline has already been established to Turkey, for example.
Looking ahead, Ghorbani told captivated gasworld delegates in Dubai that Iran has big plans to go way beyond this and become a major player in the global LNG market.
“A long-term development plan has been to convert natural gas to LNG in order to meet the needs of regions where constructing pipelines is not possible. To target the demands of distant regions for export purposes, two ways of acquiring the LNG technology are proposed – mini LNG plants involving small scale liquefaction, and LNG plants in large scales.”
“LNG consumption in the world has been increased and the total increase in 2010 is roughly 32%, which is in fact very high; this shows how important this product is. The total production of LNG in the world is around 280 million tonnes per year (tpy),” Ghorbani explained, “and the verdict is that the total production in the Middle East is around 100 million tpy - so nearly one third of the world total.”
“Iran has planned for 70 million tonnes of LNG production till 2015, which is in the form of seven large LNG plants.”
However, Ghorbani is under no illusions when it comes to the challenges ahead. Political sanctions and a difficult trading climate are cited as the biggest challenges that Iran has ahead, predicaments that will need to be overcome if the country is to realise its LNG potential.
“Unfortunately the [political] situation of the last few years has not helped with the acceleration of this, but we hope this can be overcome in the coming years,” he said.
“Future challenges in the LNG industry include the import of the main equipment or technology into Iran, due to political problems or sanctions – this is the biggest challenge for Iran’s LNG future.”
Ghorbani is optimistic about the ability to permeate these problems though, and concluded with the conviction that his country is in a prime position to drive the global LNG market in the years to come.
“Hopefully these problems will be overcome; hopefully the next time I speak here at a gasworld conference in the Middle East, I will be explaining our successes and reflecting on how these challenges have been overcome.”
“This is a very unique opportunity that we have in Iran - we have the complete supply chain all together in one place.”
Entering the LNG market
The Delvar Afzar Industrial Group (DA) includes many companies and factories, in addition to being the biggest industrial gas producer in Iran.
This wealth of cryogenic experience and expertise has lead DA to enter the LNG projects market in Iran and ultimately resulted in the establishment of two mini and medium scale LNG projects in the country.
According to the company’s founder and Managing Director Iraj Ghorbani, DA intends to invest in LNG terminals and by utilising its experience in the design and manufacture of cryogenic flat bottom tanks, DA is ‘a very capable company to participate in such projects’.