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Iran: Refining and Transport
Country Study > Chapter 3 > The Economy > Petroleum Industry > Refining and Transport

REFINING AND TRANSPORT


At the beginning of 1977, Iran had six refineries in operation, with a combined capacity of more than 800,000 bpd. In 1986 Iran had refineries operating in Esfahan, Tabriz, Bakhtaran (formerly known as Kermanshah), Shiraz, Qom, Tehran, and Lavan Island, with a combined capacity of more than 1 million bpd. All contributed to the domestic supply of petroleum products, but the Abadan refinery in the late 1970s produced primarily for export. The high cost of transportation led to regional location of refineries. Pipelines brought the crude oil from the fields to the refineries for processing and regional distribution of products.

The Abadan refinery, located on the Persian Gulf, was completed in 1912 and, until bombed and destroyed in 1980 by Iraq, remained one of the world's largest, with a capacity of 628,000 bpd. Foreign oil companies had operated it until the 1973 NIOC takeover. About 20 percent of its production had gone to the domestic market in the early 1970s, but in 1973 the NIOC geared the industry toward domestic needs and local consumption. The Abadan refinery was linked by pipeline to several fields and a seaport; the pipeline ran from Abadan north to Tehran, and then along Iran's northern border from Tabriz in the west to Mashhad in the east.

The other refineries were smaller than the one at Abadan. Two, built and operated by the NIOC, were located near Tehran to supply that market; one was completed in 1968 and the other in 1975. Both were supplied by pipelines from the southwestern oil fields. An additional pipeline also carried petroleum products from the Abadan refinery for distribution in the Tehran area.

Crude oil for the Bakhtaran refinery came from a field close to the Iraqi border; the Shiraz refinery, completed in 1973 with a capacity of 40,000 bpd, distributed its products in the southern and eastern parts of the country. A topping plant, constructed in the 1930s, operated at Masjed-e Soleyman in southwestern Iran. It supplied oil for the domestic market and sent distillates by pipeline to the Abadan refinery.

A refinery in Tabriz, constructed in 1975 and having a capacity of 80,000 bpd, supplied the northwestern area of the country. Petroleum consumption had increased rapidly in the northwest, and a pipeline was completed by 1976 from Tehran to Tabriz to supply crude to the refinery.

Khark Island, located 483 kilometers from the mouth of the Persian Gulf and about 25 kilometers off the coast of Iran, was the principal sea terminal until bombed by the Iraqis in 1985 and 1986; it had been the world's largest offshore crude oil terminal. Export of refined products then reverted to the terminal at Bandar-e Mashur in southwestern Iran, which had been used before the construction of the Khark Island installation.

The availability of new oil terminals allowed Iran to expand its oil production. In the 1960s, crude was sent to Abadan, then exported from Abadan and Bandar-e Mashur. The construction of the Khark Island terminal to export crude oil permitted use of Bandar-e Mashur exclusively for product exports. Some 95 percent of the crude oil came from the producing fields of Agha Jari, Karenj, Marun, Pariz, Bibi Hakimeh and Ahvaz.

During the 1980s, the Khark Island terminal continued to be responsible for 80 percent of oil exports. Khark Island had two terminals, one on a jetty and the other on a small island off the west coast of the island. The first was a complete complex, and the second was used for quick loading of ships. The jetty was bombed by Iraq to disrupt Iran's main shipping point in early 1985 and again more heavily in September 1985. Shipments were slowed at the jetty, and the island terminal section was devastated.

Aside from Bandar-e Mashur, other export facilities were developed both inside and outside the Persian Gulf. To reduce the threat from Iraq, facilities were expanded at the port of Jask, located just outside the Persian Gulf on the Gulf of Oman, and Sirri Island became an alternative loading point. A petroleum shuttle was initiated between Khark and Sirri islands, and Khark Island continued to export most of the country's oil until additional Iraqi bombing in January 1986. Reduced exports remained possible through the use of the shuttle service to Sirri Island, with its floating terminal for storage and reloading. The August 1986 bombing of shuttle tankers to Sirri and the resulting increase in insurance rates, however, prevented even this level of exports. Because the pipelines for Khark converge at a pumping station at Ganaveh (about forty kilometers northeast of Khark on the Gulf) before going underwater, Ganaveh replaced Khark as the western terminus of the oil shuttle to Sirri Island in the mid-1980s.

Data as of December 1987




Last Updated: December 1987


Editor's Note: Country Studies included here were published between 1988 and 1998. The Country study for Iran was first published in 1987. Where available, the data has been updated through 2008. The date at the bottom of each section will indicate the time period of the data. Information on some countries may no longer be up to date. See the "Research Completed" date at the beginning of each study on the Title Page or the "Data as of" date at the end of each section of text. This information is included due to its comprehensiveness and for historical purposes.

Note that current information from the CIA World Factbook, U.S. Department of State Background Notes, Australia's Department of Foreign Affairs and Trade Country Briefs, the UK's Foreign and Commonwealth Office's Country Profiles, and the World Bank can be found on Factba.se.

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