In February 2008 within the framework of bilateral cooperation between the Republic of Uzbekistan and Republic of South Korea, the National Holding Company "Uzbekneftegaz" and the Consortium of Korean companies on a parity basis have established the joint venture "Uz-Kor Gas Chemical" in form of Limited Liability Company.
For the arrangement of works on integrated development of Surgil field, on February 18th, 2008 a Presidential Decree № 797 was issued.
On August 4th, 2009 by the Decree of President of the Republic of Uzbekistan № 1168, the additional measures for Project implementation were adopted.
On February 11th, 2010 in Seoul the Government of the Republic of Uzbekistan, Consortium of Korean companies, NHC "Uzbekneftegaz" and JV "Uz-Kor Gas Chemical" LLC have signed the Investment Agreement. On April 15th, 2011 the same parties have signed Supplemental Investment Agreement.
The main purpose of JV "Uz-Kor Gas Chemical" is the construction of Ustyurt gas-chemical complex at Surgil field with field development. Thus, the task of specialists will include both gas processing and creation of conditions for its production and transportation. As such, during the construction of Ustyurt GCC, company shall produce gas and condensate from Surgil field and sell it to JSC "Uztransgaz" and JSC "Uzneftmahsulot" respectively.
Ustyurt GCC shall be located in north-western part of Uzbekistan (Republic of Karakalpakstan, Kungrad region, Akchalak settlement), in the southern part of Ustyurt Plato.
Ustyurt GCC will process 4.5 bcm of gas and annually from gas-condensate Surgil, East Berdakh and North Berdakh fields and other fields respectively. The processed products shall include 400 thousand tons of high-density polyethylene (HDPE), 100 thousand tons of polypropylene, sales gas, py-gas and py-oil. In addition, the Ustyurt GCC shall sell excess electricity generated in excess of its needs.
This Project shall be implemented through the project financing in compliance with all principles of project finance. Up to date the consortium of Lenders, consisting of Asian Development Bank, K-SURE and KEXIM export-import bank has been formed. At present time the negotiations on terms for provision of loans and insurance coverage for other international banks are being conducted.
In parallel, the Lenders and their Consultants are implementing detailed due diligence of all the areas of the Project.
Great help to JV “Uz-Kor Gas Chemical” LLC in this unique Project for the Republic of Uzbekistan is provided by various consultants, such as:
· Financial Advisor – ING Bank (UK);
· International Legal Advisor – Dewey & LeBoeuf (UK);
· Local Legal Advisor – Leges Advokat (Uzbekistan);
· Tax/Accounting Consultant – PriceWaterHouseCoopers (Uzbekistan);
· Environmental and social consultant– MottMacDonald (UK);
· Insurance Consultant – Willis (UK);
Currently active work on conclusion of contracts on "turnkey" basis for the construction of plant, external infrastructure and Surgil field development, as well as other project agreements is being implemented.
The construction of Ustyurt GCC is planned to be completed by 31st of December 2014.