Feasibility Study of Establishing a Mini Refinery
Abstract:
Oil Refineries are designed for chemical engineering processes and converting crude oil or gas
condensate into utilizable products like gasoline, kerosene and gas oil.
Location preferences for mini refineries construction are proximity to raw materials, access to
hydrocarbon feedstock sources, the magnitude and diversity of refined products market and
production technologies. These factors can help to determine the best location and capacity to
establish a refinery.
Advantages of Establishing a Mini Refinery:
Publicizing the use of petroleum products in all parts of the country, urban population growth
resulting in consumption centers dispersal, decrease in oil and gas production, building crude oil
pipelines in all parts of the country, necessity for exploitation of small-scale oil fields, access to
new technology and possibility to import crude from other countries have made a great
opportunity for investment in this field.
Mini refinery is a small unit with a capacity of 200 to 20,000 barrels per day, with the ability to
produce products that are usable by end-users.
One of the major policies of oil industry is to build small refineries in different provinces of
country.
One of the major policies of Oil and Petroleum Ministry is to build mini refineries the country.
The Importance of Establishing a Mini Refinery:
1.Reduction in the production and export of crude oil and gas condensate combined with
the imposition of economic sanctions
2. Privatization of refineries and petrochemical complexes in Iran
3. High demand for Hydrocarbon products in neighboring countries (Iraq and Caucasus
countries)
4. Great potential for fuel bunkering services in Arvand Free Zone
Advantages of Arvand Free Zone for Establishing a Mini Refinery:
Due to various capacities, including multimodal transit, access roads, active industries, abundant
water resources and strategic location, Arvand Free Zone is a proper region for investment.
Viable transportation routes to transport products from Persian Gulf countries to Iraq and Iraq’s
demand to import large quantities of goods from the region and Caucasus countries and also a
combination of transport possibilities in the region (water, air and land transport) have put
Arvand Free Zone in a privileged position in terms of transit.
Arvand Free Zone is one of the biggest commercial terminals by enjoying proximity to Iraq.
Moreover, being the top oil product producer and possessing 8 mini refineries and offshore
engineering and construction companies have made great potentials for intensive expansion in
this region.
According to development plans and bilateral trades’ enhancement with Iraq there are good
opportunities for improving offshore engineering services, and developing oil, gas and
petrochemical industry.
Advantages of Investment in Arvand Free Zone:
- Inexpensive and proficient workforce
- Inexpensive energy costs
- Inexpensive land
- Exemption from custom duties to import machinery
- 20-year tax exemption (according to free zones law)
- Value added tax law
Special geographical condition of Arvand Free Zone due to transit and strategic channels in
business routes, easy access to international waterways, and proximity to Basra (second largest
province of Iraq) has captivated international attention as an especial location for commercial
and business development.
Also, 20-year tax exemption according to Free Zones law, exemption from customs duties for
importing machinery and raw materials and exporting goods, special facilities for the transfer of
goods produced in the region to the mainland, easy and unrestricted currency exchange, and
proper situation for joint ventures have made an intriguing situation for investment in Arvand
Free Zone.
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