Photographer: Henrik Kettunen/Bloomberg

Iran Seeks $29 Billion for Steel to Mining Projects

Iran has $29 billion of mining investments attracting interest of companies from Europe to Asia, with plans to more than double steel production by 2025 and boost exports once international sanctions are lifted.

Iran, home to the world’s biggest natural gas reserves, plans projects ranging from steel to aluminum production, gold mining and copper, Mehdi Karbasian, deputy minister of Iran’s Ministry of Industries, Mines & Trade, said in an interview in Tehran. German, French and Dutch delegations visited Iran in the past few weeks, and a two-day seminar on steel opportunities is tentatively set for September on Kish Island in the Persian Gulf, he said. Companies looking to invest don’t want to be identified until sanctions are removed, he said.

Iran has more than 3,000 active mines, mostly privately owned, with 9 percent of the world’s gypsum production and 2 percent of molybdenum and nitrogen output, according to a 2010 report by the U.S. Geological Survey. Oil producers such as BP Plc and Royal Dutch Shell Plc have expressed interest in developing Iran’s crude reserves, the world’s fourth-biggest.

“Sanctions imposed on Iran did certainly hurt the Iranian people and also certainly slowed development in steel and other fields,” Karbasian said Sunday at the headquarters of the Iranian Mines & Mining Industries Development & Renovation Organization, where he also serves as chairman. “Investment in Iran when sanctions are lifted will be win-win situation.”

Iron Ore

Iran has 2.7 billion pounds of iron ore, used to make steel, according to Karbasian. Steel production is set to jump to 55 million metric tons by 2025 from 22 million tons this year, pending new investment and the end of international sanctions following the nation’s nuclear accord with world powers last month, he said. Sanctions against Iran’s oil industry should be lifted by late November, state-run Islamic Republic News Agency reported yesterday, citing Oil Minister Bijan Namdar Zanganeh.

“The projected capacity will help us to raise our steel exports by around 12 million tons a year,” he said. Last year, Iran exported 2.5 million tons of steel products to Italy, the United Arab Emirates, Iraq, Thailand, Spain and Britain, he said.

German, French and Dutch delegations visited Iran in recent weeks, he said. “We have held extensive negotiations with them in regard to investments in the steel and mining industries,” Karbasian said. “We have also had negotiations with representatives of British and Austrian companies.”

Negotiations are under way with unidentified Japanese companies for them to invest in the Makran steel plant, which has capacity to produce 3 million tons of steel, in Iran’s free trade zone of Chabahar on the coast of the Gulf of Oman, he said. Chabahar has rail links to bring in iron ore from Iran, along with Turkmenistan, Kazakhstan and Afghanistan, he said. Steel companies from India and South Korea are also considering investments in Chabahar, he said.