Iran builds major oil treatment facility in Kharg Island

Operations have begun for the construction of Iran’s largest crude oil processing facility in the Persian Gulf island of Kharg, a senior oil official says.

Mahmoud Zirakchian-Zadeh, managing-director of National Iranian Offshore Oil Company (NIOOC), said on Sunday that the treatment facility, to be built through a 500-million-dollar investment, would add 200,000 barrels per day (bpd) to Iran’s crude processing capacity in the Persian Gulf.

“The design, construction, installation and operation of Kharg Oil Production Plant will be totally handled by Iranian contractors and manufacturers,” the official stated.

The facility, whose construction is estimated to last three years, would process crude oil pumped from Doroud I, Doroud II, Abouzar and Forouzan oil fields.

The project is financed by the National Development Fund (NDF) and Bank Tejarat, Zirakchian-Zadeh said.

The Kharg oil terminal is currently handling about 98 percent of Iran’s crude exports and the island has more than 40 storage facilities capable of holding a total amount of 22 million barrels of crude oil.

Iran has also started building four new storage facilities on Kharg Island with the overall capacity of 4 million barrels of crude oil.

The country holds the world’s second-largest proven oil reserves and also the second-largest natural gas reserves.

The country’s total in-place oil reserves have been estimated at more than 560 billion barrels, with about 140 billion barrels of recoverable oil. Moreover, heavy and extra heavy varieties of crude oil account for roughly 70-100 billion barrels of the total reserves.