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Russian Co-operation & The Uzbek Gas Plants.

During a Sept. 1-2, 2008, visit to Tashkent, then Russian PM Vladimir Putin (since May 2012 again president) discussed with his Uzbek hosts an increase in both the volume and price of Uzbek natural gas being purchased by Gazprom, the Kremlin's key money-making giant and export monopoly, and construction of an LPG plant at the Mubarek gas field by another Russian company, Stroytransgas.

The latter project and several others promoted by major Russian businesses, however, were later held up by the Uzbek authorities, who were concerned about the growing Russian influence over Uzbekistan's economy. Uzbek natural gas has high sulphur content and this must be reduced considerably in processing.

The Mubarek gas processing plant is the largest one in Uzbekistan and has a capacity of over 28.3 BCM/year. Nevertheless, Moscow has later discussed further Russian investments in the Uzbek energy sector.

The Shurtan Gas Chemical Complex came on stream in December 2001. The complex cost about $1bn. The Japan Bank for International Co-operation (JBIC) gave $400m for this project and the US Ex-Im Bank provided $200m. The gas plant at Shurtan cleans the gas and compresses it. The complex has plants which can produce ethylene, polyethylene and 137,000 t/y of LPG. The complex is located in the Shurtan gas fields in south-western Uzbekistan in the Kashkadarinsky region (see below).

There is an underground gas storage facility at Kodzhaabad in the Andijan region. This was completed in 1999 at a cost of $72m, allowing increased gas shipments to Uzbekistan's industrial heart-land in the Ferghana Valley.

An LPG plant has been built for UNG's gas processing unit ShurtanNefteGaz (SNG) in the Kashkadarya region. SNG, one of three gas processing firms in the UNG group, runs 11 BCM/y of gas. After the final phase of construction, the plant earlier in 2010 began producing at the rate of 175,000 t/y of propane and butane. The first phase completed in early 2007 has a capacity of more than 45,000 t/y. UNG wants to have a number of plants to increase LPG production at the Mubarek gas processing complex and the Shurtan gas production complex.

UzNeftePereRabotka (UNPR), a unit of UNG, is in charge of the oil refining sector. The government has been hoping to sell a 39% stake in UNPR, as part of a privatisation process decided in 1998 and delayed repeatedly. Tashkent is also offering a 49% stake in UNG, a holding concern created out of nine companies in 1998 to unite the country's petroleum sector, as well as 44% of UzNefteGazDobycha (UNG's E&P arm), 44% of UTG, and 39% of UzBurNefteGaz (a drilling unit). BNP Paribas has acted as a financial adviser to the government for the privatisation process.
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Publication:APS Review Downstream Trends
Geographic Code:9UZBE
Date:Oct 15, 2012
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