Mazut Production in Iran: Human and Environmental Devastation for Nothing

by Zamaneh Media — 18June 2022

Mazut is one of the many products produced at crude oil refineries, but also, one of the cheapest and most polluting amongst such products. Its use is prohibited under international law in various areas. As Dr. Keyvan Hosseini, a lecturer at the University of Södertörn in Sweden, tells Zamaneh, mazut is considered one of the major products of Iran’s oil refineries as a result of their low efficiency.

In recent years, Iran has been burning massive amounts of mazut to generate electricity, although this should not be the case under Iranian law. Fereydoun Abbasi, a member of the parliament’s energy commission, called on the public to reduce electricity consumption on June 7, stating, “We will definitely have a blackout this summer because with the hot weather, electricity consumption will increase, especially in the south…We need to burn Mazut”. He further added, “It is not wise to buy diesel for 60 cents and burn it in the power plants, because the price of the electricity we want to produce is one cent. That is not acceptable…we have no choice but to burn Mazut”.

Dr. Keyvan Hosseini

However, Mr. Hosseini says Iran should switch to solar power plants as soon as possible and improve the performance and efficiency of oil refineries.

Although the Clean Air Law of Iran was announced for implementation in 2017, it has yet to be properly implemented in Iran. Air pollution levels are increasing in various cities across the country due to the burning of mazut, the use of outdated cars, and particulates resulting in haze. Mazut specifically, leads to an increase in the concentration of sulfates (sulfur oxides) and the release of the active ingredient sulfur dioxide into the air. When sulfur dioxide is inhaled, the nose, throat, and airways become inflamed, resulting in coughing, shortness of breath, or a feeling of pressure in the chest area. These symptoms develop rapidly, taking only 10 to 15 minutes to appear after sulfur inhalation

“Oil and natural gas accounted for more than 98% of Iran’s total primary energy supply. Therefore, aspects like political stability, energy security, power generation, economic growth, and poverty alleviation strongly depend on the oil and natural gas industry in Iran.”

Dr. Keyvan Hosseini points out that Iranian oil refineries spend energy and money and in turn, create environmental injustices by polluting the air, soil, and water resources to produce a non-profitable product, mazut. Read our interview with Dr. Keyvan Hosseini below:

Mr. Hosseini, in your 2019 research published in the Journal of Energy, you demonstrated that the Iranian refineries are not efficient and therefore as a result, 30% of their product is residual fuel oil in the form of mazut. Can you explain more about this inefficiency and its cause? Why has Iran not been able to modernize its refineries and why is there no investment priority for this area? What is your estimate of the return on this investment if made in the short, medium, and long term?

According to U.S. Energy Information Administration (EIA), on average less than 3% of crude oil intake by U.S. petroleum refineries is converted to residual fuel oil. In contrast, on average, almost 30% of crude oil intake by Iranian petroleum refineries is converted to low-quality and heavy residual fuel oil (mazut). Globally, petroleum refineries concentrate mainly on the production of transportation fuels (in particular gasoline) due to their high value and to an increase in demand for transportation fuels and a decrease in the demand for residual fuel oil in recent decades.

Based on the International Energy Agency (IEA) data, Iran cannot satisfy the domestic demand for transportation fuels, forcing the country to import gasoline. Therefore, in our study, we recognized three problems in the current petroleum industry in Iran: the large proportion of crude oil in exports, the imports of gasoline and diesel fuel to Iran, and the high production percentage of an unprofitable product, mazut, in petroleum refineries.

To achieve better performance, Iranian petroleum refineries must improve their production pattern by equipping themselves with new technologies to satisfy the demand for transportation fuels in the domestic market. Therefore, improving all private and state-owned refineries by instalment of residue fluid catalytic cracking (RFCC) unit is an applicable and highly recommended scheme. Currently, the only RFCC unit in Iran is located in the Arak refinery, and this unit decreases the production of mazut and increases the production of gasoline substantially. Thus, based on this improvement, using RFCCs is a promising remedy.

According to the Sixth Five-year Development Plan of Iran (2017–2023), the share of mazut in the oil refineries’ total output should not exceed 10%. Improving the existing refining sector would be a major step to raise the production of transportation fuels to meet the domestic demand and increase the export of transportation fuels. These plans can boost the income from Iran’s oil sector and, as a result, may lead to a higher economic growth rate and poverty alleviation, which are the main goals of Iran’s Sixth Five-year Development Plan.

“Energy justice defines as ensuring that people have access to energy to maintain a decent quality of life and that the production and distribution of energy is conducted in a manner that causes no harm, environmentally or socially.”

A consequence of the need to implement the above-mentioned plans is that the country needs to attract foreign investment. To achieve its Sixth Five-year Development Plan, Iran requires $200 billion of investment in the oil industry, which local resources cannot afford. Therefore, it should be derived from foreign investment, which is a problem since the disorganized Iranian financial system is not attractive to overseas petroleum investors. Besides, the ambiguous future of the Iran nuclear deal and the imposition of more sanctions provide uncertainty in the future of foreign investment. To achieve the required investment in the oil sector, which can lead to economic growth and energy sustainability in the long run, Iran needs to maintain a friendly relationship with the Organization of the Petroleum Exporting Countries (OPEC) in order to control the oil price and exports, and also adopt a tactful and moderate foreign policy to eliminate both financial and technological sanctions against the Iranian economy.

I believe that it is unlikely to attract foreign investment in the current situation as it would require a reform in the structure of Iran’s entire economy and political power. Moreover, continuous international political conflicts and regressive theocratic totalitarian policies for more than 40 years have given Iran a negative perception among investors.

+Read the full interview here

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