Iran has added an additional 2mn barrels of crude oil storage capacity to its Kharg Island export terminal, with tanks 25 and 26 being put back into operation after refurbishment on May 17, according to Shana.

Both tanks have a capacity of 1mn barrels each, and had previously deteriorated due to poor maintenance and lack of investment – a direct consequence of continued sanctions against the country’s energy sector by the US.

Hamid Bovard, managing director of the National Iranian Oil Co. (NIOC) said regarding the repairs that “Increasing storage capacity particularly under the complicated energy market situation is a strategic advantage,” adding: “Kharg is not only an oil exports terminal. The facilities are provided here for processing oil from three big [offshore] fields of Abouzar, Forouzan and Doroud in this area”.

Rehabilitation of the tanks has been fairly comprehensive, including sediment removal, roof repairs, floor plate replacement, redesign of roof drains, cathodic protection system installation and a repaint at tank 25, and a new roof and floor, new roof drainage systems, safety systems such as foam suppression, cooling and geomembrane and geotextile layers as well as earthing systems and containment basins at tank 26.

Kharg currently plays a vital role in handling Iran’s crude exports, dealing with around 90% of the country’s oil. The country has consistently pushed to increase its storage capacity, as oil trade continues to play an important part in the country’s economy.

The country also plans to invite foreign investment that will add an estimated 7.7mn barrels of new storage capacity, as well as two crude oil transmission pipelines.

Previously, Iran revealed that it was expected to construct eight new crude storage terminals with a capacity of 500,000 barrels each for use at the Jask export terminal. According to an S&P Global Commodity Insights report in September 2024, 7mn barrels of crude and products was added at Qeshm Island.

The report also highlighted that since 2023, Kharg Island’s crude storage capacity had remained at 4.5mn cubic metres (28.3mn barrels). Iran’s last two large-scale export terminals had a capacity of 700,000 cubic metres and 900,000 cubic metres at Sirri Island and Lavan Island respectively.

Total capacity of roil products storage is estimated at 11.5mn cubic metres, according to S&P.