National Petrochemical Company (NPC)in mid-July met international engineering, procurement and construction (EPC) contractors based in Tehran to lay out its plans for 2005-10 (see table). The company also briefed the contractors on its bidding policies.

Some of the planned developments announced have already been tendered, like the crackers for the olefins 8 and 11 projects. Others will depend on the conclusion of joint venture agreements with foreign companies, such as the gas-to-liquids (GTL) proposals with South Africa’s Sasoland the Royal Dutch/Shell Group. All projects in the plan are to enter construction during 2005-10.

NPC forecasts that its production capacity at 2015 will be 12 million tonnes a year (t/y) of ethylene, 10 million t/y of polymers, 8.5 million t/y of urea, 7.5 million t/y of methanol and 4 million t/y of aromatics. The total capacity by that date will be 77 million t/y, of which 15 million t/y will be intermediates and 62 million t/y marketable products. The total annual value of its products by 2015 is estimated at $26,000 million, of which $20,000 million will be final marketable products. The company aims to be the world’s largest ethylene and urea producer.

NPC will sell up to 50 per cent of its share in each of the ventures it establishes. The company by 2015 will have feedstock requirements of 10 million t/y of ethane, 183 million cubic metres a day of natural gas, 315,000 barrels a day (b/d) of liquefied petroleum gas and 400,000 b/d of condensates.

NPC told the companies that all future projects will be awarded as EPC or engineering, procurement, construction and commissioning (EPCC) contracts. Projects worth less than $100 million will be awarded to local companies, and those worth more than $200 million to foreign-led consortia. Both local and foreign companies will be eligible to bid for projects worth $100 million-200 million.

Addressing the concerns of foreign contractors that local companies could not handle the scope on all projects tendered, NPC said they could set up local affiliates to bid as local companies.

It also said they could submit letters with their bids distancing themselves from liability for the local content in a project.

Contractors present at the meeting included: the UK office of Foster Wheeler International, Hyundai Engineering & Constructionand Daelim Engineering & Construction, both of South Korea, Chiyoda Corporation, Tomen Corporation, Toyo Corporation, Mitsubishi Corporationand Nissho Iwai, all of Japan, Italy’s Snamprogetti, Germany’s Linde, the European offices of Stone & Websterand MW Kelloggand the local Petrochemical Industries Design & Engineering Company(Pidec).