Oil price: Why should the West worry about Iran's latest energy project?

To strike a balance between its ability to cause chaos in the global oil markets by closing or disrupting the Strait of Hormuz, and the need to maintain the flow of oil export revenues to Asia, Iran has taken swift and extraordinary moves to develop the Bandar Jask Port project.

In a report published by the American Oil Price website, author Simon Watkins said that the port of Bandar Jask does not overlook the dangerous Strait of Hormuz, but is located in the southeast of the Gulf of Oman, and this provides a relatively risk-free route to maritime transport to major markets in the east for Iran. Especially China and India, and to markets further south in Africa.

According to Torg Dahkani, CEO of the Iranian Petroleum Industry Engineering and Development Company, which is responsible for building the project in cooperation with the National Iranian Oil Company, the first full phase of crude oil exports will start from the Jask port within the next 12 months.

Once fully operational, this project will be able to transfer 1 million barrels of crude oil per day from Iran, especially in the first phase of a group of resource-rich fields in the West Karon region.

In addition, the port of Jask will be used to transfer crude oil supplies to oil refineries and petrochemical plants, in order to raise the country's exports to Asian countries as well.

Project work plan
The writer quoted a high-ranking source, working closely with the Iranian Ministry of Oil, as saying that the current logistical model under the current conditions is not sustainable, as about 90% of Iranian oil destined for export is currently located in "Khark Island " , with most of the remaining payloads passing Through stations in Laoan and Siri, which makes them an easy target for attacks, and a major factor in paralyzing the Iranian economy.

Even before the United States resumed sanctions in May 2018, the Khark Station was not ideal for use by tankers, given the narrow strait of Hormuz which forces it to move slowly and cautiously.

According to the plans currently in place, the $ 1.8 billion oil pipeline, which is 1,000 km long, will link Goriya in Khuzestan Province and Jask in Hormuzgan Province.

Once the oil arrives at the Jask port, it will be located in the first stage storing it in one of the twenty reservoirs, with a capacity of up to five hundred thousand barrels of oil per tank, to be loaded later to the very large crude oil tankers heading from the Gulf of Oman to the Arabian Sea and then the ocean The Indian.

According to the Iranian source, these products include automotive fuel, diesel fuel, aviation fuel, sulfur, butadiene, ethylene, propylene and ethylene glycol mono.

This part of the JASK project will be managed by Bakhter Petrochemical Holding Company, despite the possibility that "foreign companies" may participate in it, according to projects director of the National Iranian Petrochemical Company, Ali Muhammad Busaqzadah, recently.

The writer quoted the Iranian source as saying that China has offered to send the largest possible number of engineers and other professionals required in such a project to Iran as necessary.

The Iranian source told "Oil Price" that the goal is to make the Jask port able to store about thirty million barrels, with the possibility of exporting between two and 2.5 million barrels of oil per day if required, and take control of a "facility outside" at Need within 12 months from the end of next year. "

Reasons for supporting the project
Although the current president, Hassan Rouhani, who was one of the first co-sponsors of the JASK project, cannot constitutionally stand for re-election again next year, Oil Price understands that support for the project extends across all political groupings, and has the full support of the IRGC for three reasons. Major.

First - The adoption of a course that does not pass through the Strait of Hormuz indicates that Iran is able to continue to develop its crude oil business with China and India as well, under supervision if necessary, as long as it is necessary to wait for the United States to return to the negotiating table on the comprehensive action plan. Shared.

Second - This means that a great deal of financing (or imports of goods in exchange for the oil deal) will flow to Iran from both China and Russia, as both of them contributed to saving the costs of the JASK project, and they have already made clear that they will provide more financing for this project.

Finally - the availability of massive storage capacity for oil after a short direct cruise from India indicates that pressure from India and Pakistan is likely to lead to the signal being awarded for the construction of an oil and gas pipeline linking Iran and India or Iran, Pakistan and India.

In a related context, the Iranian source said, "It will require the stationing of Iranian security personnel, i.e. the Iranian Revolutionary Guard, on Indian soil or on Pakistani and Indian territories, which is of great strategic importance to the Iranian Revolutionary Guard.

Skip US sanctions
The writer explained that due to the consensus among the parties in Iran regarding the JASK project, the progress made was very rapid, as the project construction phase started only in 2018, but it nevertheless overcome the various obstacles resulting from the re-imposition of US sanctions soon thereafter.

The most important of these obstacles are in obtaining the necessary supplies of pipes and related engineering, and this was achieved thanks to the alternative situation that Iran often uses to re-localize the required technology or communicate with Moscow and Beijing.

According to Dahkani, the process of supplying the various sites inside and around the JASK project with related pumps and equipment will begin within the next few months.