Sabalan Petrochemical’s shares will be listed on the Iran Fara Bourse Securities Exchange (IFB) market within the next three months
Sabalan Petrochemical’s shares will be listed on the Iran Fara Bourse Securities Exchange (IFB) market within the next three months. That’s according to Reza Karimi, CEO of Sabalan Petrochemical. He referred to the record-breaking production and income in the last fiscal year and said the company has had a profit of 1.5 times last year, and this profit was due to increased production. Sabalan Petrochemical had a decrease in production at some point due to a shortage of feedstock and technical problems, but now it has become a profitable company and is going to be listed on the Iran Fara Bourse Securities Exchange (IFB) market. He expressed hope that within the next 3 months, part of the company will enter the capital market.
He noted that whenever the company receives gas, oxygen, water, and utilities in general, it is ready to produce above 100%, but now it is facing an oxygen shortage and are producing below capacity. He said the company has discussed with Damavand Energy Company (DECO), which supplies oxygen, and perhaps the company will enter into the discussion of building a small ASU unit to both supply oxygen needs and take a step in the field of energy optimization. He said the company already has a series of steams that can be used for turbines. Thus, there’s no need to worry about electricity. He said if a permit is issued to build this unit, the company can compensate for the oxygen shortage by 25,000 cubic meters.
Karimi said the problem of oxygen shortage has always existed. Site 2 of Sabalan petrochemical is scheduled to be put into operation in October, but there is no oxygen. Furthermore, the oxygen generator unit of Damavand Energy has an advancement rate of 30%. Therefore, it is worrying that the unit is ready to start up but there is no feed for it.
Karimi also touched on the company’s exports and said SECO International Trading Company, which is a subsidiary company is the sales agent. He said 80 percent of Sabalan petrochemical market is related to China and 20 percent is related to India. Therefore, the price is determined by these two customers, and that’s why this issue should be examined in the working groups so that the company can be benchmark and price maker.
Phase 2 of Sabalan has a problem with methane and oxygen feedstock
Regarding the fact that petrochemical units are interested in building utilities instead of production due to profitability and how true this is, Karimi said oxygen is the second feedstock for methanol production units. The fact that companies can build an oxygen unit is different from building a utility. Sabalan is concerned that Damavand Energy Company will not be able to complete this unit due to sanctions and financial problems, and this will cause the project to lag behind. He expressed concern that it lacks of oxygen becomes a permanent problem, the company would face serious problems.
He noted that the company does not receive feed for 4 months of the year. The global price of methanol has dropped sharply, meaning that all factors have come together to make methanol producers lose money. In addition, Sabalan phase 2, which will be put into operation in October and is a completely Iranian unit, should receive feed. The CEO of Sabalan Petrochemical stated that in the marketing, the producer must know the initial price of the material, which in thus case is gas, and proceed with production based on that.
