July 13, 2009 / 5:18 AM / 11 years ago

Iran seeks China investment to build refineries

BEIJING, July 13 (Reuters) - Iran has sought investment from Chinese oil firms to help build and upgrade its lagging refining sector, as the world’s No.5 crude exporter seeks to cut gasoline imports, Beijing-based industry officials said on Monday.

China’s top three oil firms PetroChina (0857.HK), Sinopec Corp (0386.HK) and CNOOC, and state banks such as China Construction Bank (0939.HK) were briefed last week by senior Iranian oil officials in Beijing on a series of refining projects under Tehran’s planning board, the officials said.

Iran, the world’s No.5 oil exporter, lacks refining capacity and must import large amount of costly gasoline to meet its domestic requirements, a vulnerable situation as the West seeks ways to put pressure on Tehran over its disputed nuclear programme.

An official with National Iranian Oil Company’s (NIOC) Beijing office said last week’s forum, chaired by Iran’s deputy petroleum minister, Shahnazi Zadeh, was to be followed by detailed discussions with Chinese firms. He did not elaborate.

Hossein Noghrekar Shirazi, NIOC’s refining head, was quoted by a Chinese newspaper as saying that Chinese investors would enjoy policy sweeteners such as a 5 percent discount in raw materials purchased in Iran and 8-year tax break for investments made in its free trade zones.

The refinery buildups, including the 2.7-billion-euro Abadan refinery due for start-up in 2012, were part of Iran’s 20-year oil sector revitalisation plan calling for total investment of more than $130 billion, Shirazi was quoted as saying.

Chinese firms are already investing in Iran’s oil, gas exploration and production sectors, as the world’s No.2 oil consumer now imports half its crude oil consumed, but have yet to enter Iran’s refining sector.

(For a factbox of Iran’s refinery and expansion projects, click [ID:nLR122987])

Reporting by Chen Aizhu; Editing by Jonathan Hopfner

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