The local Petrochemical Industries Design & Engineering Company (PIDEC)has been awarded a Eur 267 million ($321 million) contract to build the ethane cracker at the Arvand Petrochemical Companyolefins 8 complex at Bandar Imam. A much larger cracker contract, awarded in June to Germany's Linde with the local Sazeh for the olefins 11 project, has come under attack by Majlis (parliament) deputies, leaving its fate again uncertain (MEED 8:7:05).
The Arvand plant will have capacity of 1 million tonnes a year (t/y). The 48-month contract will be carried out on an engineering, procurement and construction (EPC) basis. ABB Lummus Global of the Netherlands will supply the technology and carry out basic engineering. The olefins 11 contract, which calls for the construction of two identical 1.2 million-t/y crackers, came under attack in early July from Majlis deputy Ahmad Tavakoli, a close ally of incoming president Mahmoud Ahmadinejad. Tavakoli said the tender had been biased towards foreign companies and that local engineers could carry out the work far more cheaply and with the same level of quality. National Petrochemical Company (NPC) managing director Mohammed Reza Nematzadeh has defended both contract awards. Industry analysts have attributed the attacks to political gamesmanship in the run-up to the presidential inauguration on 4 August. Ahmadinejad has promised to support both local industry and foreign investment. However, if the political squabbles persist and financing is delayed, the fast-rising cost of procurement could endanger both projects.