Uzbekistan to Boost LNG Output in 2015

November 29, 2013

Uzbekistan in 2015 plans to increase liquefied petroleum gas (LPG) production 2.2-fold, up to 600 thousand tons a year, the Times of Central Asia reported on November 28. However, decreasing hydrocarbon production and the country’s gas export commitments may prevent the achievement of the plan.

Last week Uzbekistan’s national oil and gas company Uzbekneftegaz launched a propane-butane producing facility at the Mubarek gas processing plant. The $244-million project was financed through a $85-million loans from China Development Bank and funds from the Uzbek side.

After reaching its design capacity in 2014, the new facility will annually process 12 billion cubic meters of natural gas and produce 258,000 tons of liquefied gas and 125,000 tons of gas condensate. More than 80 percent of output is meant for export.

According to Uzbekneftegaz, LPG production will be increased mainly at the Mubarek gas processing plant and Shurtanneftegaz. The program also includes modernization of the Fergana and Bukhara refineries for further LPG production, and projects to utilize associated petroleum gas at oil fields in the Kashkadarya region in southern Uzbekistan. Total investments in the program will amount to $500 million.

By 2016 Uzbekneftegaz plans to increase LPG production 2.2-fold compared with 2012, to 600,000 tons. This figure would guarantee stability in Uzbekistan’s fuel market, but fulfillment of the plan is likely to be postponed. The first three quarters of 2013 show that this year the Uzbek LPG market will hardly surpass last year’s output of about 280,000 tons.

The reason is Uzbekistan’s decreasing gas production and gas export commitments, mainly to Russia and China. In addition, there is no free access to liquefied gas resources in Uzbekistan: 55 percent of LPG goes for export, 35 percent is sold directly to large consumers, and only 10 percent is sold in the free market.

Copyright: The Times of Central Asia, 2013