The Forum for Partners in Iran's Marketplace

June 2018, No. 87


Completion of Projects and Attraction of Capital

We should increase national unity to leave the crisis behind and move towards development, production and employment.

Deputy Minister of Industry, Mine and Trade and the Iranian Mines and Mining Industries Development and Renovation Organization (IMIDRO) Chief Executive Officer said that $4.5 billion worth of mineral and mineral industries projects were launched last Persian calendar year (ended March 20, 2018), adding that $1.5 billion in new project will be inaugurated in the new year.

Dr. Mehdi Karbasian expressed hope that the new Persian year 1397 (2018/2019) will be a year of economic opening for the people. He also said he was relatively happy with the record last year of the mining and mining industries. He said the mining sector experienced output growth, more exports, productivity and investment in the previous year.  He added that the growth in the mining sector had been noted by the Supreme Leader and the President in their remarks last year. Among the projects commissioned by the President and first VP last year, there were a number of projects commissioned by IMIDRO or those backed by the organization to overcome their problems.

New Project worth 320 Trillion Rials

The IMIDRO CEO said the balance in steel output faced problems in 1392 (2013/2014), but in 1396 (2017/2018) the capacities were increased in pellets sector, concentrates and sponge iron. He said about 700,000 tons of sponge iron had been exported last year and hoped that in 1397 this balance will get closer to the 55 million target. He said at the beginning of the 11th government in 1392, we had half-finished and unfinished projects worth 240 trillion rials. We attracted 80 trillion rials from the private sector to activate all the projects. Also, in 1396, new projects worth 320 trillion rials were started or were activated in the mining and mining industries sector.

According to Karbasian, in the steel sector, three provincial sponge iron projects were commissioned during 1396. With the follow-ups of the National Steel Company, the steel sector of the projects will also go on stream.

I am confident that we will have a good year in 1397 with the grace of God and the management of our colleagues, a year of dignity and pride of Iran.

As for ​​gold production, he said there has been some improvement in Zarshouran gold mine and expressed hope that other deficiencies would be removed in the current year. Also in Muteh complex, gold production increased from about 200 kg to 600 kg.

He added that in the aluminum sector the problems we faced in 1395 (2016/2017) remained unresolved. “We could not get our dues for the sale of Almahdi Hormozal Company. We also had liquidity problem with IRALCO but the South Aluminum project continued strongly and we forecast get output in the second half of the current calendar year and raise the country’s aluminum capacity to over 700,000 tons.”

Karbasian stated: “In the copper sector, we had some progress. Following interactions with the creditable company, Glencore, the company extended credits to us and this helped the copper company to make profit and commission some of its projects. Others will be inaugurated this year.

Glencore plc. is an Anglo–Swiss multinational commodity trading and mining company with headquarters in Baar, Switzerland.

He said in 1396, the titanium project was activated after many years. The Parsian-Lamerd special zone project also entered the construction phase and the first phase of the project is expected to become operational in the current year. Among other active projects of the calendar year 1397 mention can be made of rare earth elements.

Pointing to the special support for in-depth explorations as one of the priorities of IMIDRO in 1397, Karbasian said: “An important point we noticed in the 250,000 square kilometer exploration program is that there are almost no large mines on the ground-level, and we need to correct the path of exploration and we have to invest in underground mines.

Mineral explorations are currently underway in areas spanning over 250,000 square kilometers in Sistan and Baluchestan, Kerman and Kurdestan provinces with the private sector undertaking exploration on more than 100,000 square kilometers of the areas. Iran is home to around 10,000 mines, only 6,000 of which are active. The country’s mineral reserves stand at 60 billion tons, close to 40 billion tons of which are proven.

“By implementing upcoming plans we hope to discover new mines and reserves and provide more production and employment opportunities. In 1396, the exploration program continued with strength, and by the end of the current year, 180,000 square kilometers of initial activities of this exploratory program (aeronautical survey and geophysics) was carried out and was ready to be ceded to the private sector.

IMIDRO CEO noted that with discoveries made in the iron ore of Yazd Province and with excavations carried out at a depth of 1900 meters, we found reserves of about two billion tons of high-grade iron ore, which suggests that the country is rich in in-depth mines. He added that new deposits of bauxite were taken from the existing mines in the Jajarm region. Along with this, the record for alumina powder production was registered last year, and the Jajarm Aluminum ingot project was progressing well.

Direct Export of 8 Million Tons of Steel

Noting that before the Iran Nuclear Deal (also known as the Joint Comprehensive Plan of Action), most of the country’s exports abroad was done through intermediaries and even by receiving commissions, Karbasian said: “After the JCPOA our exports to Europe and the rest of the world were done directly so that over the past year, more than 8 million tons of steel were exported, including a part to Europe and even Canada.

He added: “One of the positive steps taken in mining and mineral industries in 1396 that was a source of pride was that this sector was introduced in the economic cycle, and investors who would not come forward made investments in this sector and made 100 percent profit.

Registration of 20% Share of Mining & Mineral Sector from Exports

IMIDRO CEO said that mining and mineral industry exports reached $8.5 billion in the first 11 months of 1396, accounting for 20% of the country’s total exports and about 5% to 6% of the GDP. In the steel chain, we had a 34% increase in exports in 1396 compared to 1395.

He added: “During 1396 in Sangan region, three projects were inaugurated and this year two other projects will go on stream. The region’s employment rate was less than a thousand in 1392, but now it has reached more than 4 thousand people, which has inspired hope in the youth of the region for the future.

Private Sector Investment Welcome!

Karbasian said IMIDRO was obliged to invest in places where the private sector had the capability to invest. He added: “We are obliged to enter the field where the private sector is less likely to invest. For example, we open LCs for Parvardeh 4 project in Tabas so that we could cede it if the investor shows interest.

“Another goal is to complete half-finished projects at a faster pace, with a suitable timetable in order to reduce the costs, and this is among our honors.”

IMIDRO CEO considered the issue of environmental safety as one of the priorities of his organization and noted that in 1396, the organization’s status was good in this area. For example, in Mehdiabad mine, along with the implementation of the project, the animal environment was also heeded which led to an increase in birth rate in wildlife. 

Need to Increase National Unity

At the end, Karbasian thanked the nuclear negotiating team, stating that we should accept that in 1397 foreign pressure would not decrease. “We should increase national unity to leave the crisis behind and move towards development, production and employment. Our national, religious and moral duty as IMIDRO is to do our job properly, increase productivity, raise production and reduce costs… I am confident that we will have a good year in 1397 with the grace of God and the management of our colleagues, a year of dignity and pride of Iran.”


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  June 2018
No. 87