Double Alkyl Delight

How do assess the contribution of ICIIC to the development of the chemical and petrochemical industry in Iran?

Established by the Bank of Industry and Mines, our company produces linear alkyl benzene, the main raw material for powder and liquid detergent. To produce this, we use a technology that we originally received from an American company called Universal Oil Products (UOP). We signed a contract 25 years ago with the London branch of UOP because of the limitations of dealing with the US. Our original capacity was around 50,000 tons per year, and we started production around 22 years ago. Domestic demand at that time was around 38,000 tons per year. The remainder of our capacity was exported to countries like India and Persian Gulf countries such as Kuwait, Qatar, and Oman. Around 12-15 years ago, we did our first expansion project and increased our capacity from 50,000 to 75,000 tons per year. At that time, we increased the capacity to produce normal paraffin from 43,000 tons per year to 140,000 tons in our first expansion project.

What is your strategy to stay ahead of the competition here?

During the last few years, we sold around 75,000 tons of linear alkyl benzene to the domestic market, with which we fulfill 90% of domestic demand. Consumption of detergent in the country has increased from 2kg per capita annually 22 years ago to over 15kg now. In some European countries consumption is even at 35kg per capita. Before ICIIC was founded, all the linear alkyl benzene that was needed in Iran was imported, mainly from Spain, Italy, and Germany. After we started production, we delivered nearly the full domestic demand, and the average consumption of detergent increased. During the last two to three years, we negotiated with UOP London to receive its latest technology. Because of the sanctions, every time UOP said it was ready, something happened and we had to wait. After signing the nuclear deal, UOP agreed to start negotiations about providing us with this new technology. This resulted in a contract that was signed in late 2016. We are now conducting our second expansion project, which involves the removal of the dangerous HF acid from our production process while increasing the capacity by around 100,000 tons per year. Once completed, we will be able to produce around 200,000 tons of linear alkyl benzene per year.

What is the export strategy of your subsidiary Commercial Port Services?

We send our product by truck from Esfahan to Bushehr. From there, it goes to its final destination by vessel. We export to countries like India, China, Indonesia, and sometimes Turkey and Pakistan. We have some exports to Turkey by road as well.

Are you targeting new export markets?

We are looking at some African countries. When you go through the Persian Gulf to the Red Sea, places like Kenya and Sudan become interesting. We want to focus on the eastern part of Africa because it is important to be careful with transportation costs. Our competitor is a Spanish company that also produces linear alkyl benzene. From Spain, it uses the Mediterranean to transport its products; therefore, we need to be able to compete on transport costs when exporting to new markets. We have agreements with some experienced consultants to assist us in opening new markets.

What is your outlook for the year ahead?

I am positive. Especially for petrochemical companies, the future will provide good market circumstances. Our product sales and exports increase every year, and our second expansion project and the application of the new catalyst technology will allow us to increase revenues.