UZBEKISTAN - The Ferghana Refinery.

The biggest of the three plants, the Ferghana refinery was built during the Soviet era. It present it produces mostly high quality diesel and fuel oil. The refinery has been upgraded and expanded to 108,000 b/d by Mitsui of Japan under a contract worth $200 million.

The Mitsui project involved installation in late 1999 of a hydro-desulphuriser which increased the refinery's output of low sulphur diesel. A new crude oil pipeline has been built from Kokdumalak oil and gas field, the biggest producer in Uzbekistan to supply the refinery.

Funds for the refinery project were provided by the European Bank for Reconstruction and Development ($90 million) and the Japan Bank for International Co-operation ($100 million). Uzbekneftegaz provided the equivalent of the remaining value in support services.

ChevronTexaco and Uzneftepererabotka have a plant at the Ferghana refinery as a joint venture producing lubricants. Under an agreement with Texaco signed a few years ago, the US major is marketing a major part of the lubricants in neighbouring Central Asian countries.

ExxonMobil has considered moving to build up a strong position in Uzbekistan. This US major has been importing Turkish lubricants for sale in Uzbekistan. It has considered new joint venture possibilities and a plan to exchange crude oil and refined products between Uzbekistan and Kazakhstan.

The Bukhara Refinery: Built at a cost of $400 million by Technip of France and JGC and Marubeni of Japan, the refinery at Bukhara has a capacity of 50,000 b/d. The refinery, processing condensate, has been on stream since September 1997. It produces gasoline, high-quality gasoil, LPG and fuel oil. The plant gets its condensate supplies by pipeline from the Kokdumalak oil and gas field, which is the biggest oil producer in Uzbekistan. At Kokdumalak a new compressor station has been built for the Bukhara refining system. The design of the refinery allows for capacity to be doubled in future. An important part of the output is exported, with the nearby Chinese market having become very attractive.

Agreement to build this refinery was signed with Technip in late September 1993. At the time it was envisaged as a 100,000 b/d plant to be built at a cost of $2 billion. This followed a February 1993 protocol between the Uzbek government and Elf of France (now part of TotalFinaElf), which then owned 35.5% of Technip, to co-operate in oil E&P, refining and the international trade of oil products. Morgan Guaranty Trust Co. acted as the financial advisor on the project.