China and Iran to build oil export terminal in Persian Gulf

China and Iran agreed to jointly build an oil terminal in the Persian Gulf.

The planned oil terminal will be built on Qeshm Island in the southern part of the Persian Gulf. It is expected to turn it into an important hub for oil production and storage.

The $550-million contract was signed by Iran’s Machine Making Co. and China’s largest heavy industry enterprise, Iran Daily reports.

Qeshm Island will be able to store 10 million barrels of light, heavy and ultra-heavy crude oil produced in Iran’s West Karoun region.

The oil terminal will be large enough to handle tankers up to 140 meters deep and store an estimated 30 million barrels of crude.

In keeping with a 10-year lease contract the terminal will generate up to $300 million in revenues annually.

Qeshm Island, with an area of 1,491 square kilometers, is the largest island in the Persian Gulf and lies to the north of the Strait of Hormuz.