Abbas Mohsen Nikoogoftar, speaking to reporters on Aug. 10, said the refinery’s strategic plans include construction of a 500-megawatt solar power plant, production of higher-value-added products, expansion of export-oriented products and investment in transformative projects.

He said the refinery, one of the key pillars of energy supply for Tehran, is redefining its strategic development plan with a focus not only on increasing production but also on environmental goals and sustainable operations.

Nikogooftar highlighted the industrial potential of Rey, describing the area as the country’s energy town and noting that cooperation among 10 major industrial companies in the region creates significant capacity to supply fuel and petroleum products to provinces and industries across Iran.

The CEO said the refinery’s priorities include developing new businesses, becoming a petro-refinery, entering innovative fields such as solar power generation, expanding its export portfolio, producing higher-value products, carrying out major maintenance and implementing projects to optimize resource consumption and strengthen distribution network resilience.

He also called for attracting investment and increasing capital to finance development projects and improve product quality.

“We welcome fair criticism and precise questions from the media,” Nikogoftar said, adding that media scrutiny can help the company navigate its challenges with greater clarity and determination.

He said reliance on domestic capabilities and moving toward a petro-refinery model are essential to overcoming the imbalance between energy production and consumption and ensuring energy security for future generations.

“Stable energy supply is not only an economic priority but also an issue closely linked to national security,” Nikogoftar said, describing the fuel supply-demand imbalance as one of the country’s most complex challenges.

250,000 barrels per day

The Tehran refinery processes 250,000 barrels of crude oil per day, accounting for 14% of Iran’s refining capacity, Nikogoftar said.

In 1404, the refinery accounted for 37% of the country’s gas oil production, 16% of gasoline, 22% of fuel oil and 5% of jet fuel, he said.

The refinery also supplied 52% of Iran’s jet fuel last year and accounted for 27% of the base-oil, 6% of gasoline, 12% of gas oil and 14% of vacuum-bottom market, he said.

Normal-hexane unit nears completion

Nikoogoftar said construction of the refinery’s normal-hexane unit has been completed, while its gasoline-producing CCR unit is 80% complete.

The normal-hexane project required an investment of 7.5 million euros and 174 billion rials and is expected to come on stream during Government Week, he said.

The unit will produce 2,000 barrels per day of normal hexane with 52% or 85% purity, free of aromatics and sulfur. The product will be used in the rubber and printing industries. The project is expected to recover its investment within 40 months and generate $3 million in annual revenue for the refinery.

The CCR gasoline unit, currently 80% complete, will increase the Tehran refinery’s gasoline capacity by 22%, adding 1.5 million liters per day to the country’s gasoline production, Nikogoftar said.

He added that all gasoline produced by the refinery will meet Euro 5 standards once the unit is operational.

Record economic performance

Nikoogoftar said the refinery achieved record economic indicators in 1404 despite a 20% decline in global oil prices and operational restrictions in March that reduced annual refining capacity from 90 million to 83 million barrels.

For the first time in the refinery’s history, gross profit reached $12 per barrel and operating profit stood at $13 per barrel, he said, describing the figures as among the highest in Iran’s refining industry.

Gas oil accounted for 37% of the refinery’s output, with a margin of $27.50 per barrel, while jet fuel had a $26-per-barrel margin. Together with gasoline, the three key products accounted for 58% of total output.

The refinery also replaced 68% of its liquid-fuel consumption with natural gas, saving 1,840 metric tons of fuel, Nikoogoftar said.

Turning negative margins positive

Nikoogoftar said major upgrading projects are needed to address energy imbalances and meet environmental requirements.

About 20% of the refinery’s current output consists of residual products, which sell for about $42 per barrel because of pricing constraints, while the crude feedstock costs $54 per barrel, he said.

Through quality-upgrading projects, those residual products can be converted into higher-value products and sold for about $76.50 per barrel, creating a positive margin of $22.50 per barrel, he said.

Nikoogoftar also noted that Tehran Refinery received a transparency award among more than 500 companies listed on Iran’s capital market.

The refinery’s crude processing cost is about $3 per barrel, he said, attributing the figure to tight cost management. Feedstock accounts for 94.4% of costs, labor for 4% and other expenses for 1.6%.