China and Iran have agreed to build oil terminal on Qeshm island

Almaty. June 15. Silkroadnews – China and Iran signed $550 million contract to cooperate on construction of oil terminal in the southern part of Qeshm island, People’s Daily reports.

According to the publication, the Iranian engineering company “Arak” signed a contract with China’s largest enterprise in heavy industry to build the oil terminal in the south of Iran, in the free trade zone.

The project’s major objective is a construction of Iran’s largest terminal for oil production and storage on the island of Qeshm. As soon as the first stage of the project is completed it will be possible to store 10 million barrels of crude oil on the island.

The representative of the Iranian side of the project said this is the largest project in the country in this field, its depth makes 140m, total storage capacity serves up to three thousand barrels of oil.

It is also reported the oil terminal construction shall bring Iran to lease agreement for 10 years. With oil storage rent Iran is expected to generate about $300 million profit annually.

Qeshm is the largest island in the Persian Gulf, with area of 1491 square kilometers. According to the report the construction of the oil terminal shall boost the development of the southern regions of Iran and has a strategic importance for the country’s development as well.