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    Uzbek GTL Project Shows Signs of Life

Summary

A decade-old plan to develop a Gas to Liquids (GTL) unit in Uzbekistan seems to be advancing, with AmecFW's announcement of an order.

by: Mark Smedley

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Natural Gas News, Asia/Pacific, Europe, Corporate, Competition, Contracts and tenders, Infrastructure, News By Country, United Kingdom, Uzbekistan

Uzbek GTL Project Shows Signs of Life

A sign that a long-delayed Gas to Liquids (GTL) project in the Central Asian republic of Uzbekistan – first mooted a decade ago -- may be taking shape emerged this week with an announcement by UK contractor Amec Foster Wheeler. 

Investments in GTL projects globally have cratered in recent years because the collapse in crude oil prices has made production of synthetic diesel (the main GTL product) uneconomic in most cases, with only small projects turning US landfill gas into synthetic fuels reaching completion in 2016-17. 

South Korea’s Hyundai Engineering in 2013 secured the $3.2bn turnkey contract to build the 37,000 barrel/day ‘Oltin Yol’ GTL plant on behalf of a joint venture of Uzbekneftegaz and Sasol (each 44.5%) and Petronas 11% -- at that stage it was due for completion 2017. Last year Sasol said it was having second thoughts about what it said was a $5.6bn venture; now the GTL development is 100%-owned by Uzbekneftegaz

AmecFW said August 8 it has been awarded a contract by Hyundai Engineering for delivery of hydrogen plant technology and design and materials supply for a steam reformer heater for Oltin Yol which it said is “under construction in the Kashkadarya region of Uzbekistan.” 

Updates on the construction status of Oltin Yol, which would require 350mn ft3/d of methane-rich feed gas, are limited on either its own or on Hyundai Engineering's websites. However the former said that Hyundai was issued with a "notice to proceed" with the project on November 30, 2016.

AmecFW said the scope of its work includes the basic design engineering for the 37,100 m3/yr hydrogen unit; basic and detailed engineering; and procurement for the steam reformer heater; plus site advisory services. It said it is currently in the detailed engineering phase for the plant's steam reformer, scheduled for completion 2Q2018. “This award confirms the impressive performance of AmecFW’s hydrogen technology as well as the proven advantages of our [proprietary] 'Terrace Wall' steam reformers,” said its technology vice-president Andy Hemingway. No contract value was disclosed.

UK competition issues

In its 2Q results released August 10, AmecFW said it still intends to submit a formal proposal to UK competition regulator CMA of what assets it plans to divest, in order to satisfy the CMA’s concerns. On August 2, the CMA announced its concerns that Wood Group’s planned takeover of AmecFW would reduce competition in the supply of UK upstream services, and warned AmecFW it had until August 9 to formalize its proposal about divestments.

 

Mark Smedley