Uzbekneftegaz, Gazprom ink deal on strategic cooperation

By Azernews

By Kamila Aliyeva

The National Holding Company Uzbekneftegaz and Russia's Gazprom PJSC signed an agreement on strategic cooperation, a representative of the Uzbek holding told Trend.

The document was inked by Uzbekistan’s Deputy Prime Minister, Chairman of the Board of Governors of Uzbekneftegaz Gulomzhon Ibragimov and CEO of Gazprom energy company Alexei Miller in the framework of the St. Petersburg International Economic Forum – 2017.

The document envisages cooperation between the parties in the implementation of new projects in the territory of Uzbekistan.

Within the framework of the agreement, the parties will cooperate, in particular, in the field of reconstruction, construction and operation of gas infrastructure facilities, geological exploration, production, processing and storage of hydrocarbons as well as use of compressed and liquefied natural gas for autonomous gasification. 

Gazprom has been cooperating with Uzbekistan since 2002. Then, Gazprom International completed a five-year exploration program on investment blocks in the Ustyurt region, which resulted in the discovery of the Jel gas field in 2009. The parties plan to sign a production sharing agreement (PSA) on Jel.

Gas Project Development Central Asia AG (GPD, a subsidiary of Gazprom International) is a member of a consortium that since 2004 under the PSA has been building and reconstructing the Shakhpakhty field in the northwest of Uzbekistan.

GPD also owns 25 percent of the equity participation of Kokdumalakgaz joint venture (JV), which is engaged in the extraction and utilization of associated gas in the fields in the Kashkadarya region.

This year, GPD and Uzbekneftegaz created Natural Gas Stream for joint exploration and development of gas fields in the Ustyurt region.

GPD will also take part in the construction of a new oil refinery in the Jizzakh region.

In April, Uzbekistan’s government signed PSA on the investment block "Independence of Uzbekistan" with supplementary exploration and development of the '25 years of independence' gas field with a consortium of investors in the GPD, Altmax Holding Ltd. and Uzneftegazdobycha (part of Uzbekneftegaz). The total volume of investments under the PSA is estimated at the level of $5.8 billion. 

The project is designed for 30 years. At the initial stage, it provides for the creation of capacities for extraction and processing of up to 2 billion cubic meters of gas per year, at the second stage the capacities can be increased to 4 billion cubic meters. It is planned to build a gas chemical complex on the basis of the '25 years of independence' field.

In April, within the framework of the visit of the Uzbek president to Russia, Gazprom and Uzbekneftegaz signed a five-year contract on Gazprom’s purchase of 4 billion cubic meters of gas annually.