SKS Development of Malaysia, whose parent company in early 2007 signed a US$16 bn deal with NIOC for an integrated gas E&P/LNG export venture, in March offered NIOC a minority stake in a US$2.2 bn refinery to be built in Kedah state with a capacity of 200,000 b/d. This is to be part of a much bigger set of projects to bypass the Strait of Malacca (see omt16IranExprtApr16-07). SKS will own the majority in the refinery, which would process Iranian crude. SKS, linked to Malaysian tycoon Sayyed Mokhtar al-Bukhary, plans to start building the refinery in July.
Malaysia’s growing commercial ties with Iran have become a concern among lawmakers in Washington, which bans US firms from doing business with Tehran and is currently negotiating a free-trade deal with Kuala Lumpur. In January, the head of a key committee in the US Congress called for a halt to trade talks with Malaysia after SKS Ventures signed the deal to develop Iran’s southern Golshan and Ferdows gas fields and produce LNG for export. The gas deal potentially allows Washington to penalise SKS under the recently expanded Iran Sanctions Act, which calls for steps against companies involved in Iranian energy development, though the US has not taken measures against big European and Chinese firms doing business there.
It was reported earlier this month that Daelim Industrial Co. of South Korea was building an LNG tank farm at Tombak on the Hormuzgan coast. That was the first physical work awarded on Iran’s LNG programme. It was said the $3 bn project was to be carried out with the local Ghorb Nooh – an affiliate of Khatam al-Anbia (Ghob), an engineering and construction giant which belongs to Iran’s elite Islamic Revolutionary Guard Corps (IRGC). The IRGC and its various units are under UN sanctions and it is not yet clear how the UN will affect this and other projects. The project will comprise three LNG tanks with total capacity of 140,000 tons, as well as two LPG tanks with capacity of 30,000 tons. The client, NIOC, wants the farm finished by August 2010, when the first LNG projects at Tombak are planned to come on stream.
Oil Minister Vaziri on April 9 said Iran was close to a deal with China’s Sinopec on developing Iran’s Yadavaran oilfield to produce 300,000 b/d. Sinopec Group, state-owned parent of Sinopec Corp, agreed in October 2004 to take the lead in Yadavaran and to buy 10m t/y of LNG for 25 years in a deal worth US$100 bn.
Source: / thefreelibary /