WILL IRAN BE ABLE TO BUILD UP ABADAN REFINERY AGAIN?




Mustafa AY – TDO – 05.07.2017 Abadan Oil Refinery came into existence as a result of Anglo-Persian partnership. It then became one of the most important oil refinery in terms of income for the country. It is an undeniable fact that Abadan both steered the world politics and helped Iran to gain a determinant status in the regulation of World oil market. Abadan refinery had played a vital role in the energy supply for British warships in WW I. Afterwards, British army altered the course of history in WWII as British aircrafts and armored forces fighting Nazi forces in North Africa were endorsed by Abadan. This explains the reason why British forces attained the triumph over Nazi Germany in North Africa.

Iran owed its rapid development to the enormous income yielded by oil export. Particularly, after National Front leader Mosaddeq took office in 1951, he launched a great campaign against Britain and its private oil companies within the country. He advocated that British Oil Corps deprived Iranians of their own rights that was deriving from Britain’s colonist aspect. His strict stance on rejection of British existence within Iranian border literally compelled British people to abandon the country. Withdrawal of British people followed the nationalization of Abadan oil refinery meaning Iranian state undertook the oil production as monopoly.  However, this ended with Military Coup d’etat overthrowing Mosaddeq administration with the backup of MI6-CIA in 1953. Right after the successful coup, in 1954, Shah Pehlevi signed International Oil Consortium that the right of self-decision over both oil production and sales was revoked from Iran.

In 1977, Abadan reached its and world’s peak in terms of oil production by raising its production to 600.000 b/d which made Abadan refinery take the title of the biggest refinery in the World. However, that production was seriously crippled to one fourth level due to the increasing presence of Ayatollah Khomeini in Iranian politics. When Khomeini seized the control of Iran, British presence and influence in the oil production vanished.

Abadan oil refinery is located near Iraq border. Following Iran-Iraq war erupted in 1980, Baathist regime decreed air forces to Abadan. This led a financial crisis in Iran. Then, Iran suffered from budget deficits stemming from revenue loss. Today, Abadan is not the same as beforehand.

India invested Iranian energy sector ın the amount of 11 billion Dollars. This investment promises Iranian’s energy sector to reinvigorate that means Iran stands a chance of getting former magnificence in oil production. Besides, there are other possible contributions Iran foresaw. To give an example, indigenous capital owners working out oil sector will be stimulated through money circulation created by investment. This would lead Iranian oil corps to enhance their technological infrastructure. Therefore, Iran would likely reach its former days. This dream seems not so far.