Russian Giant Eyes Uzbek Gas
A group of mostly investors including Russian Gazprom is planning to develop and produce gas in Uzbekistan, from the major gas field '25 Years of Independence', under a production-sharing agreement (PSA). The project has a timeframe of 35 years and an estimated total cost of more than $2bn, to be met by international finance institutions.
The project involves additional exploration and development of the gas field and building a gas chemical complex in the Surkhandarya region in the south of Uzbekistan.
The development of the gas field, one of the biggest in Uzbekistan, is among the projects named in the PSA for the 'Independence of Uzbekistan' block, which was signed during the state visit of president Shavkat Mirziyoyev to Russia in April. Reserves are put at about 100bn m³ and will be primarily used for petrochemical production.
The partners are fund manager Andrei Filatov, who announced the news November 29; Gas Project Development Central Asia, which is an affiliate of Russian monopoly Gazprom; Cyprus-registered Altmax Holding; and the national domestic company Uzneftegazdobycha. The Surhan Gas Chemical Operating Company, established by members of the investment consortium to operate oil and gas PSA projects, will manage the field development. So far no companies have been named as contractors although Filatov named the major oilfield companies that have been contacted.
Filatov will participate in the consortium through Brighttree Holding, a special-purpose vehicle that has taken a 50% stake in Altmax Holding. Therefore, the share of the new investor in the gas field development project will be 37.5%.
Surhan Gas Chemical Operating Company CEO Andrei Ignatov said the development of '25 Years of Independence' is of great importance for Uzbekistan, both from a social and economic point of view.... I am confident that participation of Andrei Filatov with his understanding of the specifics of implementation of large infrastructure projects and his colossal experience in attracting investments will be extremely useful for the development of our project.”
Filatov, as well as fund manager, is also the billionaire founder of London-listed Global Ports Investments and Globaltrans.
The project will have two stages. This year and next the partners will drill a confirmation well, confirming the reserves, develop a feasibility study and sign commercial terms and conditions. The second stage will include the field development, geological exploration, the construction of a gas conversion facility and a gas chemical complex to produce high added-value products.