Petrochemicals’ strategic shift in the 14th government: From capacity building to value creation

According to Energy Press, the Ministry of Oil of the 14th government has prioritized the petrochemical industry not only as a production sector, but also as one of the main drivers of economic growth, currency stability, and balanced regional development. Within this framework, more attention has been paid to new approaches such as synchronizing capacity development with sustainable feedstock supply, focusing on increasing real production instead of nominal capacity, facilitating pending projects, strengthening domestic manufacturing, and localizing strategic technologies.

The role of the National Petrochemical Company as the governing body and regulator of this industry has also gained double importance in creating coordination between the government, holding companies, the private sector, investors, and other stakeholders.

In an interview with Hassan Abbaszadeh, CEO of the National Petrochemical Company, the Oil and Energy Information Network (SHANA) has attempted to present a clear picture of the 14th government’s approach to the petrochemical industry, its programs and actions in the areas of food supply, value chain completion, export development, strengthening domestic manufacturing, and the role of this industry in the country’s economic growth and currency stability.

In this interview, the Deputy Minister of Oil has explained the policies, challenges, and future prospects of Iran’s petrochemical industry, and has drawn a clear message for industry activists and domestic and foreign investors; a message based on realism, synergy, and a purposeful move toward sustainable development.

With what approach has the 14th government prioritized the petrochemical industry in its industrial and economic policies?

The 14th government has focused petrochemical industry policymaking on increasing production, completing added value, developing export markets, and facilitating project implementation, and is trying to achieve a more operational and coordinated performance through special institution-building and planning compared to the approaches of previous governments. The priority of this industry is development in line with completing the value chain and reducing raw material sales by using domestic capacities and focusing specifically on managing feedstock resources, which is one of the main challenges of the petrochemical industry.

In line with these goals, strategic working groups and planning have been formed; specialized working groups have been formed to coordinate with the Seventh Development Plan and manage petrochemical feedstock issues, energy conservation, and project feasibility studies, and efforts to facilitate licensing and financing of pending projects have also been put on the agenda. Strengthening exports and market management are other goals that are being pursued seriously, hence special attention has been paid to developing export target markets, reducing focus on one or more specific markets, and expanding international cooperation for the sale of petrochemical products.

In the 14th government, the petrochemical industry, in addition to developing capacities, places greater emphasis on removing project implementation obstacles and increasing domestic value added compared to previous governments. The strategy of completing the value chain, which was proposed in the fifth and sixth development plans, has found greater links with the country’s macroeconomic goals and development plans in this government.