Iran’s NPC Poised to Change Competitive Landscape for PP

Fueled by an advantaged feedstock position and ongoing discussions with various multi-national companies - including France’s Total, Germany’s Linde & BASF, Japan’s Sojitz & Mitsui, South Korea’s Hyosung and Anglo-Dutch Shell - Iran’s National Petrochemical Company (NPC), a subsidiary of the Iranian Petroleum Ministry, has made great strides in the 18 months since “Implementation Day”; the day on which nuclear-related sanctions against Iran were lifted under the Joint Comprehensive Plan of Action (“JCPOA”).

NPC is a subsidiary of the Iranian Petroleum Ministry and is 65% owned by the government of Iran. Townsend’s recently published Annual PP Global Assessment shows that as of January 2017, NPC’s polypropylene (PP) capacity totaled 1,080 kt/y, including only wholly-owned plants. With this overall capacity, NPC currently ranks #17 among PP suppliers worldwide. By January 2022, with an increase in capacity to 1,705 kt/y, its ranking will inch up to #16. 
The company is self-sufficient in propylene monomer for its polypropylene production.  At every PP plant, 100% of the propylene requirement is sourced from an NPC steam cracker either on-site or nearby.   The propylene capacity for NPC, as of January 2017, totaled 1,187 kt/y, including only wholly-owned plants. With this overall capacity, NPC currently ranks #27 among the worldwide propylene suppliers. By January 2022, with an anticipated increase in capacity to 3,021 kt/y, NPC will jump to #12.
NPC employs only technology that has been licensed from other companies. Its current PP process technology mix is as follows:

  • Licensed Spheripol technology (Arak, Assaluyeh, and Bandar Imam)
  • Licensed Mitsui Toatsu slurry technology (Bandar Imam)
  • Future PP expansions by NPC will most likely be based upon Spheripol technology.

The company’s marketing arm, Petrochemical Commercial Company (PCC) was established in 1990 and has since been privatized.  A major exporter of petrochemical products for the country, PCC is also present in China, India, UAE, and Europe.  


NPC reports that total Iranian petrochemical capacity is sitting at 70 million t/y and has set targets for 2026 of at least 140 million t/y.  According to Roberto Ribeiro, President of Townsend Solutions, Houston based plastics market research and consulting firm, “The lifting of sanctions and resulting influx of foreign direct investment (FDI) has been good news for Iran’s oil and gas industry, which needs upwards of US$200 billion in investment in the next 5 years to reach its potential… but, there is still a long road ahead.  Sensitive foreign relations, internal and international policies, and a complex legal environment are just a few of the hurdles facing potential investors.  

According to the 2017 United Nations Conference on Trade and Development’s report on World Investment, Iran attracted roughly $3.4 billion in FDI in 2016, a very positive 64 percent growth in comparison with the previous year.  However, FDI in Iran is actually significantly less than it used to be in 2011 ($4.3 billion) and 2012 ($4.7 billion), when international sanctions imposed on the country were at their highest point.”   
​​According to The National Petrochemical Company Investment Directorate there are four polypropylene projects representing over 1,700 kt/y of capacity considered “ready for partnership,” with an additional 940 kt/y still under study by shareholders. 

It’s interesting to note that the Assaluyeh facility is part of the Pars Special Economic Energy Zone, home of South Pars Gas Field // North Dome, the largest independent gas reserve in the world.  Shared by Iran ‎and Qatar, the field is ‎‏105‏‎ kilometers away from the Pars Special Economic Energy Zone on the Iran side. The ‎reservoir covers ‎‏9,700‏‎ square kilometers in total with ‎‏3,700‏‎ square kilometers belonging to Iran. ‎ The field is reported to contain more than ‎‏51‏‎ trillion cubic meters of natural ‎ gas and stands for roughly ‎‏48‏‎ percent of Iran’s confirmed reserves.‎ 
With an estimated population of 79 million people, Iran is the second largest economy in the Middle East and North Africa (MENA) region after Saudi Arabia, with an estimated Gross Domestic Product (GDP) in 2016 of US$412.2 billion. 

For more information on the polypropylene industry and Townsend’s newly published Annual PP Assessment, contact Peter Callais at +1-281 582 0150 or [email protected]

For more information on the plastics industry in Iran, contact Roberto Ribeiro at +1 (281) 582-0473 or [email protected]