Iran-Venezuela joint venture methanol project stalls

19 December 2010

Bids submitted in July, but no award for Assaluyeh scheme

Contractors bidding for a $350-400m engineering, procurement and construction (EPC) contract to build a methanol plant in Assaluyeh in southwest Iran continue to wait for news of an award from Hamburg-based VenIran Petrochemicals Company (VIPC), an Iran-Venezuela joint venture.

“Nothing has been awarded yet, but contractors have almost closed the file on VenIran,” says a source close to the scheme.

According to the source, the partners are concerned over the commitment of potential technology licensors given Iran’s current international isolation.

Two local consortiums were shortlisted for the deal in May, led by local firms Namvaran and Petrochemical Industries Design & Engineering Company (PIDEC). The companies submitted bids for the engineering, procurement and construction (EPC) contract on 23 July (MEED 10:9:10).

Commercial offers were due to be opened in Venezuela at a ceremony with the Iranian Oil Minister, Masoud Mirkazemi, in August and expected the contract to be awarded in September. That did not happen as Mirkazemi cancelled his trip to Venezuela.

The Iran-Venezuela joint venture aims to develop a methanol plants in each country. The Assaluyeh plant is widely seen as a replacement for the Kharg Petrochemical Company’s 730,000 tonne-a-year (t/y) methanol project, which was cancelled in 2009.

There has been some concern, however, that the Venezuelan partner is reviewing its plans for a methanol plant in favour of building a gas sweetening and sulphur removal plant.

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