Economy and Business - Tehran Times

Iran's National Development Fund to boost assets to $61b

2013-09-14T16:10:40Z

TEHRAN - Assets of Iran’s National Development Fund will increase by over $8 billion in the current Iranian calendar year to reach $61 billion, the NDF deputy director has said.

Qasem Hosseini said the figure represents the worst case projection.

If the projected oil revenues are earned, the fund’s assets will hit $61 billion by the end of the year, Hosseini said.

The current Iranian calendar year began on March 21, 2013.

The NDF assets amounted to $49.9 billion in the past Iranian calendar year, he said.

He further said that $400 million from the fund will be drawn out to buy new airplanes.

Iran transfers 20 percent of its oil revenues to the NDF.

Iran, top producer of cement in Middle East

2013-09-14T12:51:23Z

TEHRAN - Iran is the top producer of cement in the Middle East, IRIB quoted secretary of Iranian cement industry employers Abdolreza Sheikhan as saying.

The country ranks fourth in the world, he added.

Iran’s cement output hit 31.6 million tons in the first five months of the current Iranian calendar year, which began on March 21, he said.

The cement output is projected to reach 80 million tons by the end of the year, he said.

Iran exported 8.064 million tons of cement and clinker in the first five months of the current Iranian calendar year, up 43.5 percent year on year.

Exports of cement and clinker amounted to 6.52 million tons and 1.53 million tons.

Iran plans to increase its cement output up to 85 million tons by the end of the next Iranian Calendar year.

Ex-Iranian Industry, Mine and Trade Minister Mehdi Ghazanfari said in August 2012 that the country's cement production capacity will reach 110 million tons by 2015.

Iran exported cement to 24 countries including Iraq, Azerbaijan, Turkmenistan, Afghanistan, Russia, Kazakhstan, Kuwait, Pakistan, Qatar, Turkey, the United Arab Emirates, Georgia, Oman, India, and China in the past Iranian year.

Tehran hosting three international exhibitions

2013-09-14T16:10:04Z

TEHRAN – Three international exhibitions are being held concurrently at the Tehran Permanent International Fairgrounds.

The 12th international exhibition on biscuits, chocolates, and confectionery industry is underway with 224 Iranian companies and 17 foreign companies in attendance.

The 7th international exhibition on flour and bread industry is underway with 82 Iranian companies and 4 foreign companies in attendance.

The 5th international exhibition on drinking and beverage industry is underway with 110 Iranian companies and 3 foreign companies in attendance.

The three exhibitions will wrap up today.

India keen on paying for oil imports from Iran only in rupees

2013-09-14T15:52:42Z

NEW DELHI (PTI) — India is keen to restart the system of paying crude oil it buys from Iran entirely in rupees to help stabilize the local currency and reduce the country's current-account deficit.

The issue figured during a meeting called by Principal Secretary to Prime Minister Pulok Chatterji to discuss raising crude oil imports from Iran to curtail dollar payouts, sources said.

Iran had in July agreed to take payments for oil it sells to India entirely in rupees after U.S. and western sanctions blocked all other payment routes.

However, shortly after a brief trial of the mechanism, it reverted to the old system of taking only 45 percent of the payments due in rupees.

The meeting, which was attended by Oil Secretary Vivek Rae, Commerce Secretary S R Rao and Economic Affairs Secretary Arvind Mayaram, among others, also discussed inventory management to cut oil import bill.

Sources said it was decided to engage Iran on the issue and address their concerns on using the money they get here.

India, which imported crude oil worth USD 144.3 billion in 2012-13, has already spent USD 47.13 billion on oil imports in first four months of current fiscal.

Since July 2011, India had paid in euros to clear 55 percent of its purchases of Iranian oil through Ankara-based Halkbank. The remaining 45 percent due amount was remitted in rupees in accounts Iranian oil company opened in Kolkata-based Uco BankBSE 5.25 %.

Payments in euro through Turkey ceased from February 6 this year but the rupee payments for 45 percent of the purchases continued through Uco Bank. Iran later agreed to take all of the payments in rupees.

Sources said India is keen that the system of full payments in rupee is resumed as it will help it save on the forex outflow. Oil imports have been the biggest factor contributing to a record current account deficit.

According to Oil Minister M Veerappa Moily, India could save as much as USD 8.47 billion by importing oil from Iran. It imported about 2 million tons of crude oil from Iran so far and plans an additional import of 11 million tons.

India shipped 13.1 million tons of oil from Iran. Sources said the government is mulling asking state-owned firms to keep crude imports at 2012-13 level of 105.96 million tons that will save USD 1.76 billion in foreign exchange.

Also, the government is looking at cutting down the crude inventory they hold from current 7-14 days to just 2-3 days so as to free millions of dollars oil companies keep parked in maintaining stocks.

Sources said the government was keen to cut oil import bill and help prop up the rupee, which has slipped 23 percent against the U.S. dollar this fiscal.

Iran offers India to sign PSA contract

2013-09-14T16:08:37Z

Iran has offered India to sign a production sharing contract of PSA type on gas block Farsi in a span of three months, Indian newspaper "Business Standard" reported.

Thus, Tehran is ready to accept a 100 percent payment of the price of Iranian oil import through rupees.

Due to sanctions, India has to make payments for Iranian oil imports through rupees - a currency which is facing increasing devaluation.

According to the newspaper, under the revised plan, the development of the field will require an investment of more than six billion dollars.

"Now, since we are in the need for more Iran imports, Iran is bargaining. They want us to sign the production sharing contract for Farzadb gas field in Farsi block soon," the newspaper quoted a senior official of Iran's Oil Ministry.

Earlier, Iranian oil Minister Bijan Zanganeh has said the contracts in oil and gas sector will be revised to increase the recovery rate of the country's active fields.

It was previously announced that Iran plans to adjust country's oil contracts in order to "make the contracts more attractive to foreign companies".

Iran has had experiences in buy-back and ordinary contracts with foreigners, however none of them motivated the contractors to have a firm responsibility and interest in recovery rate of a field.

However, previously, Business Standard had reported that Iran is likely to reject India's offer to go for 100 percent rupee payment through UCO Bank in return for crude imports. The oil ministry was targeting to bring down forex outflow by about $8.47 billion payment for 11 million ton of Iran crude in rupee.

Production sharing agreements can be the most interesting kind of contract for foreign investors who wish to do business in Iran.

Under the agreement, the investor company and the government will share the resources extracted from the project. Iran is very careful about the ownership of its oil and gas fields but it has announced that it will study this kind of contract for joint fields as well.

ONGC Videsh Ltd (OVL), Indian Oil Corp. Ltd (IOC) and Oil India Ltd (OIL) had won the Farsi gas block (offshore Farzad B) in 2002 from National Iranian Oil Company.

While OVL and IOC have 40 percent each, OIL holds 20 percent stake in the block, however, after over a decade-longed delay, Iran canceled the agreement.

The field is located in 90 kilometers of the Iranian port city of Bushehr, and covers a total area of ??3.5 thousand square meters. The fourth of the drilled wells, which reached depths of 3,400 meters revealed the presence of gas reserves in the field.

Farzadb field is estimated to hold 21.68 trillion cubic feet reserves which of 12.8 tcf (above 362 bcm) is recoverable.

(Source: AzerNews)

Current status of Tehran Stock Exchange’s listed companies

2013-09-14T15:56:07Z

On 1st September 2013, the number of listed companies in the TSE reached 314 companies with accepting and offering shares of a new investment company.

The newly listed firm, “SEKAB” has established in June 2004 and the company’s listing has increased TSE’s market capitalization to 118 Billion USD.

According to the Iranian calendar, in current year, four companies listed in the TSE and 13 companies delisted in the same period because of nonconformity with listing requirement in the TSE.

Now, according to the ISIC method, 314 listed companies are classified in 36 classes which in terms of the number of listed company, cement, vehicle, pharmacy and petrochemical groups respectively have maximum number of companies. In terms of market capitalization, some groups like petrochemical, oil refining, basic metals, banks, mining and holding companies located in the top.

According to the listing rules of Tehran stock Exchange, companies are classified in 2 markets, in which one market has two boards. Each boards and markets have different requirements. Companies in main board of first market must have at least 40 million USD as capital and at least 20 percent of its share should be floated. These requirements in secondary board of first market and second market are respectively around 20 and 8 million USD as capital and 15 and 10 percent as free float.

Based on the latest checking, 60 companies are listed in main board of first market and 61 companies are listed in secondary one and the others located in second market.

Tehran Stock Exchange has annual scrutiny in each June and will changes companies’ position if they lose the requirement of each market or board.

There are different indices in the TSE such as Index of 30 biggest companies, Index of 50 active companies, Index of first market’s companies and Index of second market’s companies and so on.

In spite of trading common stock, there are other financial instruments in the TSE to trade. One of those is rights that it is possible to trade for 2 month after capital raising. Moreover, it’s possible to trade participation bond (kind of Islamic bond) in Tehran Stock Exchange. Now, there are two bonds listed such as Shiraz municipal bond and Saipa (biggest vehicle company) which are being traded in the TSE with the rate of 20 percent.

Single Stock Future is another instrument in Tehran Stock Exchange. This financial instrument has been lunched 4 years ago and now there are 18 symbols of it with a two-month maturity to trade.

According to ratification of ETF’s regulation by SEO (Securities and Exchanges Organization) there will be possibility to trade on ETF in near future.

Based on trading volume, oil refining companies, petrochemical, basic metals and banks are the most popular by investors in recent days in the TSE.

(1USD = 24500 IRR)

Rouhollah Hosseini Moghaddam

Director of listed companies affairs

India to explore all options to enhance oil import from Iran

2013-09-14T13:26:13Z

New Delhi (PTI) — Indian government said it will explore all options to increase import of crude oil from Iran within the framework of UN sanctions.

"We are exploring the possibility within the overall UN sanctions. Without violating the sanctions to the extent that we can push oil import from Iran, that is being explored by the Oil Ministry," Economic Affairs Secretary Arvind Mayaram told reporters here.

India, which paid about USD 144.29 billion last fiscal for importing oil, is renewing imports from Iran as unlike imports from other countries it pays the Persian Gulf nation in rupees.

Oil Minister M Veerappa Moily has recently written to Prime Minister Manmohan Singh saying India could save over USD 8.5 billion in foreign exchange this fiscal by increasing crude oil imports from Iran.

"About 2 million tons crude oil has been imported from Iran so far during the current financial year. An additional import of 11 million tons during 2013-14 would result in reduction in forex outflow by USD 8.47 billion (considering the international price of crude oil at USD 105 per barrel)," Moily wrote.

The plan is in response to Prime Minister's call to the ministry seeking USD 25 billion cut in oil import bill to narrow the current account deficit (CAD).

India, which last fiscal imported 13.1 million tons of oil from Iran, has been, since July 2011, paying in euros to clear 55 percent of its purchases of Iranian oil through Ankara-based Halkbank. The remaining 45 percent due amount was remitted in rupees in accounts Iranian oil company opened in Kolkata-based Uco Bank.

Payments in euro through Turkey ceased from February 6 2013 and now Iran is paid only in rupees. Rupee payment helps save foreign exchange outgo, thereby reducing CAD.

Iran to boost strategic wheat reserves by 7.5m tons

2013-09-14T13:24:20Z

TEHRAN - Iran plans to import 7.5 million tons of wheat in a move to boost its strategic reserves, the Iranian deputy industry minister has said.

The administration has recently raised the guaranteed price for buying wheat from domestic farmers from 8,000 rials (about 33 cents) to 10,500 rials, the Mehr News Agency quoted Abbas Qobadi as saying on Friday.

However, the administration has no intention to increase bread prices, he noted.

It is predicted that 5 million tons of wheat will be imported by the end of the current Iranian calendar year (March 20, 2014), he added.

Iran has purchased doubled the purchase of wheat from domestic farmers to 4.1 million tons.

Moreover, some 500,000 tons of wheat is projected to be bought by the end of the harvest season.

Last year, 2.44 million tons of wheat was purchased from farmers at 7,200 rials (about 29 cents) per kilogram.

Iran's wheat harvest is almost finished and may total about 14.5 million tons, up about 5 percent from the 13.8 million tons collected a year earlier, the FAO said. Total grain production may be 21.85 million tons, up 3.4 percent from a year earlier, including 3.2 million tons of barley and 2.4 million tons of rice.

Iran may barter crude oil for Indian premium gasoline

2013-09-14T13:24:22Z

TEHRAN - Iran may start bartering crude oil for premium gasoline from India, the Mehr News Agency reported.

The Iranian Oil Ministry has taken the decision to receive Indian premium gasoline for crude oil instead of rupee.

India is increasing imports of crude oil from Iran as policy makers risk flouting U.S. trade sanctions in their scramble to halt the slump in the rupee.

Mangalore Refinery & Petrochemicals Ltd. (MRPL), India’s biggest buyer of Iranian crude, plans to buy five cargoes of 85,000 metric tons each this month, compared with three in August, Managing Director P.P. Upadhya said in an interview. Shipments from the world’s only producer that accepts rupee payments for oil are estimated to rise to 4 million tons in the year ending March 31, versus 3.9 million tons in the previous 12 months.

India is among a few countries eligible for a waiver of a U.S. law that imposes financial sanctions unless they can show they have “significantly reduced” purchases from the Persian Gulf country. Prime Minister Manmohan Singh is seeking options to revive the $1.8 trillion economy, which relies on imports to meet 80 percent of its energy needs, as he struggles to stem capital outflows that have weakened the rupee by 17 percent this year against the dollar.

“Importing crude oil from Iran is crucial as it helps in curbing dollar outgo in a big way,” Upadhya said by phone from Mangalore on India’s west coast. “We can make part payment in rupees. That’s the arrangement.”

At present, some 65-67 million liters of gasoline is being produced per day in Iran’s refineries, and the figure will be boosted to 70 million liters once two gasoline production units at Isfahan and Tabriz refineries come on stream in October.

Iran-Oman natural gas pipeline to begin operation in 18 months

2013-09-14T13:19:53Z

Ali Akbar Sibeveih, the Iranian Ambassador to the Sultanate of Oman, recently told the Times of Oman that a new pipeline, intended to transport natural gas from Iran to Oman as part of a $60 billion deal to increase cooperation and trade between the two countries, should be ready to begin operation within 18 months.

Iran and Oman last month signed a memorandum of understanding (MoU) stating that over the next 25 years Oman would buy nearly half of its total natural gas imports from Iran, via the pipeline.

Sibeveih explained that the idea of the pipeline was first discussed during negotiations over a decade ago, but that no agreement was ever stuck between the two sides. “The main reason was a lack of agreement on the price of the gas that was supposed to be exported.”

Sibeveih explained that Iran already had export deals with countries such as Iraq, Pakistan, Turkey, Kuwait, and the UAE, so Oman was the next logical step.

“The two countries made intensive efforts over the past 10 months in this regard.

The export of gas to Oman will mark a significant economic development in the relations between the two countries.”

Iran and Oman are also working to create a North-South corridor project that will form a strategic transit route to provide an easy method for the transport of goods from Central Asia to the Persian Gulf.

Two-way trade between Iran and Oman is currently at worth about $200 million a year, but it is hoped that it could reach $1 billion in the coming years, mainly through increases in the petrochemical, technology, and oil refinery sectors.

(Source: Oilprice.com)