After a visit to Moscow by Uzbek President Shavkat Mirziyoyev, Russia and Uzbekistan affirmed their strategic partnership while Gazprom signed a deal to purchase Uzbek gas (including from LUKOIL’s projects in the country).
Shavkat Mirziyoyev’s visit had been long anticipated and preparations were underway for some time: intense consultations between the two sides had been going on since the beginning of the year. A bilateral economic commission had convened in the Uzbek capital of Tashkent in February and had focused on the upcoming visit and a wide range of relevant issues: from tourism, light manufacturing and agriculture to transportation, metallurgy and energy. Experts predicted a new level of strategic partnership between the two countries and referred to Mirziyoyev’s visit as historical.
The predictions came true. Over 39 bilateral agreements were signed between the two sides, as well as over a dozen business deals totaling over $16 billion. One of the largest had to do with Gazprom’s purchase of Uzbek gas. The deal, signed by Gazprom CEO Alexei Miller and Uzbek Deputy Prime Minister Gulomzhon Ibragimov, foresees the energy giant acquiring 4 billion cubic meters of natural gas annually for a period of five years beginning in 2018. The deal marks Gazprom’s first medium-term deal to buy gas from Uzbekistan.
This was good news for LUKOIL, which is currently Uzbekistan’s largest foreign investor with gas production totaling 40 billion cubic meters to date. “I’m very happy that Gazprom made this deal with [state operator] Uzbekneftegaz because the first gas that Gazprom will receive will come from LUKOIL,” said LUKOIL President Vagit Alekperov in an April 13th meeting with Putin.
The Company actively develops its gas production projects in Uzbekistan and sells produced gas to Uzbekneftegaz. That’s why increase of Uzbek gas sales to Russian consumers will be very positive scenario for LUKOIL as well.
Meanwhile at LUKOIL’s Southwest Gissar project, several production facilities are due to come online as it goes into full development: the gas processing plant with an annual capacity of 4.8 billion cubic meters, a preliminary gas processing terminal (1.8 billion) and the gathering system. Next year, a major boost in production is expected at the Kandym-Khauzak-Shady project when the Kandym gas processing facility with capacity of more than 8 bln cubic meters comes online.
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