China, Iran to jointly build oil terminal in Persian Gulf

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China and Iran have signed a contract to jointly establish an oil terminal on in the southern , which will turn the island into an important hub for oil production and reserves, Iran’s official media reported.

Iran’s Machine Making Co. signed the contract, valued at $550 million, with China’s heavy industry enterprise to the island into Iran’s largest oil production and reserve base.

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After the completion of the first phase of the project, Qeshm Island will be capable of storing 10 million barrels of crude oil, according to Iranian state television.

This is one of the projects currently in the field, according to an employee working on the project. It can accommodate tankers up to 140 meters deep and at least 30 million barrels of .

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The oil terminal involves a 10-year lease agreement and will generate up to $300 million in every year.

Located north of the Strait of Hormuz, Qeshm Island is the island in both Iran and the , covering an area of 1,491 kilometers. All oil tankers in the will have to pass through it.

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