To expedite development plans at the Isfahan Oil Refining Company in the central Isfahan Province, Bank Melli Iran, the biggest state-owned lender, has signed a contract with the company to fund a part of ongoing projects, the managing director of the company said.
“As per the deal, the state-owned bank is committed to grant a $600-million loan to the refinery, of which $200 million have already been paid and the rest will be paid by March 2023,” Mohsen Qadiri was also quoted as saying by the Oil Ministry’s news agency.
The agreement was signed by Qadiri and Mohammad Reza Farzin, the CEO of Bank Melli Iran, in Tehran on Sunday and the bank will charge an interest rate of 18% on the loan.
“Development plans at the refining facility are making headway to help the firm boost the production of crude oil derivatives compliant with Euro-5 emission standards,” Qadiri said.
The projects, which are being completed at an estimated cost of $600 million, entail the construction of a diesel treatment unit and the installation of utility and offsite units, in addition to the completion of fuel storage tanks with a capacity of 100,000 liters of diesel per day.
Referring to other ongoing initiatives, the report said the scheme to reduce sulfur content in vacuum distillation residue – the end product of crude oil distillation, including high molecular weight PAH, asphaltenic components and waxes – has also registered 40% progress and is expected to become operational in three years at an estimated cost of $1 billion.
According to the official, the company now produces 4 million liters of Euro-5 diesel per day and output will rise fivefold in the near future.
IORC launched a sulfur granulation unit with a daily capacity of 300 tons in 2020. The move was also in line with policies to reduce environmental pollution and upgrade the quality of refined products.
Environmental Impact
Both plans are aimed at minimizing the environmental impact by curbing the toxic sulfur emissions.
Established in 1979, the refinery produces 25% of the country’s petroleum products, including 16 million liters of Euro-4 diesel, 8 million liters of Euro-4 and 12 million liters of Euro-5 gasoline per day.
The company has succeeded in removing aromatic compounds, sulfur and benzene from AW-406 solvent and converting it to ++AW-406 solvent.
Isfahan’s refinery is the main supplier of feedstock to Sepahan Oil Company, Isfahan Petrochemical Plant, Arak Petrochemical Plant, Jey Oil Refining Company and Iran Chemical Industries Company.
Crude oil needed by the refinery comes from Maroun Oilfield in Khuzestan Province via a 430-km pipeline.
As per its environmental commitments, the refinery is making efforts to reduce the amount of sulfur in mazut and gradually reduce the production of this eco-unfriendly fuel by converting it into other products.
The company's wastewater treatment unit has been launched to help meet the refinery’s water requirements.
"The plant, with a capacity of 750 cubic meters per hour and costing $8 million, was built in two years," he said.
The managing director said the refinery buys wastewater from towns like Shahin-Shahr located near the company.
Municipal Wastewater
Qadiri had earlier warned that the refinery would have to either reduce or stop production, if the worsening water crisis at the refinery was not resolved. The huge refinery consumes 1,000 cubic meters of water per hour, of which 700 cm are recycled and reused.
"We have been grappling with water scarcity for a long time," he said, adding that the company processes 375,000 barrels of crude per day but this cannot be sustained for long unless the refining units have sufficient access to water.
Located in the arid regions of Iran with minimal precipitation, Isfahan Province has been struggling with drought for seven years.
“Water flow into Zayandehroud Dam was 1.2 billion cubic meters in 2017, which has now declined to 400 million cubic meters,” he said.
“Of the total flow, 320 mcm are used for drinking purposes and the rest for industries. Due to the drastic decline in precipitation, industries have to reduce water consumption by at least 25%.”
Tapping into non-conventional resources (drainage water, greywater and treated wastewater) has become expedient to help reduce the gap between water supply and demand.
