Iran in talks to buy share in India’s Essar Refinery

Iran has started negotiations to buy an equity stake in India’s Essar Refinery and similar talks also being held with European, South American and Asian companies, deputy petroleum minister Abbas Kazemi was quoted as saying today.

Kazemi was reported by the Mehr news agency as saying that buying refineries or shares in refining companies will be one of Iran’s oil policies after nuclear-related sanctions are lifted.

India is the second biggest buyer of Iranian oil after China. Essar depends heavily on Iran to feed its 400,000 barrel-a-day (b/d) Vadinar refinery.

“The National Iranian Oil Company (NIOC) seeks to invest in the refineries which will process Iran’s crude oil. This is also economical,” Kazemi said.

NIOC Managing Director Roknoddin Javadi confirmed Iran’s talks and said negotiations have been also held with African companies.

“Iran’s crude oil must be sent to the markets where there are reliable and long-term customers,” he said. “The more we have a presence in target oil markets, the better our exposure will be guaranteed and established.”

Oil Minister Bijan Zangeneh told a news conference in Tehran that buying refineries will allow Iran to sell oil at higher prices.

The Essar Refinery transaction is evidence that Iran is preparing to increase crude oil exports rapidly after sanctions, which would be relaxed by the end of 2015.

Zangeneh said yesterday that the aim is to double exports from the present level of 1.1 million b/d.