To immunize itself from the massive effects of US sanctions, Iran has increased its gasoline production levels to 100 million liters per day. With this kind of national production capacity it has moved closer to the goal of achieving self-sufficiency, as reported Iranian media agency.
The increase comes from the Persian Gulf Star Refinery near the Persian Gulf, which in the beginning of its operations had a production capacity of only 12 million liters of gasoline and diesel per day in 2017, after successfully completing two expansion phases, the refinery’s production capacity increased to 36 million liters of gasoline per day and daily condensate capacity of 3, 60,000 barrels.
South Pars gas field which is co-owned by Iran and Qatar, feeds the condensate to the Persian Gulf Star Refinery. The facility which is condensate refinery giant in the Middle East will enable Iran to export high value products insulating the nation from the grave economic turmoil caused by US sanctions.
The exports of high value products which are in high demand in Asia including India will ensure Iran’s economic stability. Iran has also heavily invested in a refinery in Nagapattanam. The refinery which is run by Chennai Petroleum Corp. Iran has reportedly invested 15 billion euros in this refinery which expected to boost its production capacity to nine times its current production. As India is a strategic market for Iran, amidst the Sanctions fiasco, Iran’s plans to contribute a significant portion of US$ 4 billion of investment to boost production capacity nine million tons per day. The Nagapattanam Refinery along with raised production levels from Persian Gulf Star refinery will significantly improve Iran’s production.
The Indian government has also exempted payments for the imported crude from Iran from taxes. The payment will be made in Indian rupee INR as amount deposited in Indian bank. Although by tax regulations, the amount is subject to 40% tax rate, Iran has been granted exemption considering the exceptional circumstances surrounding the US embargo. National Iranian Oil Company who is the receiver of these payments has in exchange has signed an undertaking to not carry out any other activity other than receiving payments. However, Iran can use these funds to pay for imports of medical devices, medicines and food grains from India and it can also invest in debt securities of Indian government.