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I I r r a a n n E E c c o o n n o o m m y y U U p p d d a a t t e e
Issue 9/2017
Wednesday January 18th
Russia to upgrade and build two power plants in Iran
Tehran and Moscow have signed a contract for Russian companies’ involvement in two plans for increasing and improvement of electricity generation capacities in two Iranian power plants in Khuzestan and Hormozgan provinces, said the deputy Energy minister for planning &
economic affairs. According to one agreement, explained Alireza Daemi, Russian Inter RAO will improve efficiency of the outdated Ramin power plant in Khuzestan Province to 55%, from the current level of 36%. The second contract is on Russian Tekhnopromexport’s establishment of a 1400 MW power plant in Bandar Abbas, Hormozgan Province.
On August 1st, 2016, Reuters had reported that Russian Tekhnopromexport will build a thermal power plant with a capacity of 1.4 in the port city of Bandar Abbas in about five years and that the project is estimated at 1 billion euros ($1.12 billion), which will be financed through a Russian export loan for covering 85% of the project’s costs.
Bold economic and energy points in President Rouhani’s Tuesday press conference
Highlights of important economic and energy related remarks of President Rouhani in his press conference in Tehran on Tuesday afternoon:
The 7.4% GDP growth rate [achieved in the first 6 months of 1395) is unique in the region and rare in the world, especially at a time with the world is experiencing and economic downturn.
In the past year, more than 700,000 jobs were created, which, again, is a rare phenomenon in the world. But we are still way behind in creating [sufficient] jobs.
Today, if we create 1.2 million jobs annually, then the unemployment rate will [just]
remain constant [and not deteriorated from what it is now). In spite of enjoying oil revenue windfalls, the former administration failed to create jobs and only14,000 jobs were created annually at that time.
All the [nuclear-related] sanctions were removed at once on January 16th, 2016;
today, we don’t have sanctions on the oil &
gas and the transportation & insurance sectors. We have resumed normal relations with the foreign governments and banks though some banks with private stakes have remained over-prudent. Today, our people have achieved many economic gains and we should [just] resolve the remained problems.
If the nuclear deal wasn’t achieved, we wouldn’t have earned this year’s 33-trillion- toman oil revenues [in the first ten months of the year]. By the end of this Persian year (20 March), we expect our oil revenues to reach more than 70 trillion toman ($21.8 billion at the official rate of 3200 toman) that wouldn’t have been realized if sanctions were in place. Instead of saying what have been the results of implementing the nuclear deal, we should ask what would have happened if the deal hadn’t been achieved.
Rouhani invited those opponents who question the fruitfulness of the nuclear deal to remove the skepticism glasses from their eyes and see how the inventories that were filled with steels under sanctions are now emptied. “Those who say they cannot see [the positive results of the JCPOA] should see and compare the status of the country’s steel and steel industry this and past year”
said Rouhani.
NIOC may hold int’l tenders on LNG projects NIOC Managing Director Ali Kardor said on Tuesday that the country is after resuming its liquefied natural gas plans post-sanctions by attracting foreign investment in this sector,
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international tenders are likely to be held in this sector but didn’t mention any specific timeframe. Kardor said that investment packages have been defined in this respect and that negotiations have been held with some foreign companies. Kardor said if talks bear fruit with a competent foreign company, NIOC may escape tender arrangement and award the project through direct negotiations.
Kardor also told Tasnim news that NIOC contemplates diversifying its gas exports methods, including supplies in the form of LNG or entering into the “Gas-to-Wire” projects.
Note: Kardor didn’t provide information about the foreign companies with which NIOC is negotiating but before the intensification of sanctions in 2009, France Total and British Shell were the two foreign companies that were finalizing deals with NIOC to conduct the two large-scale LNG projects of Persian LNG and Pars LNG. But both projects were halted and never started not only because of sanctions but also due to the unattractive contractual terms Iran had offered at that time.
Global ship insurers to resume near full coverage for Iran oil: Reuters
Reuters: 17 Jan 2017
Global shipping insurers have devised a way to ensure nearly full coverage for Iranian oil exports from next month after striking a deal to provide cover without involving U.S.-domiciled reinsurers, officials in Tokyo and London said.
Restrictions on US firms handling Iranian goods had greatly limited the number of reinsurers of cargoes, but the new arrangements - which essentially allow re-insurance of ships without the involvement of U.S. firms - should boost the number of eligible shipments. "There will be no U.S.-domiciled reinsurer participation on the 2017 IG reinsurance program," Andrew Bardot, secretary and executive officer at the International Group (IG) of P&I Clubs in London told Reuters on Tuesday. The new arrangements take effect on Feb. 20, he and other officials said. "This will substantially address the potential shortfall in reinsurance
recoveries in the event of Iranian-related claims," he said.
