Uzbekistan lets contract for methanol-to-olefins complex

Feb. 22, 2021

Jizzakh Petroleum JV LLC, a joint venture of JSC Uzbekneftegaz and Gazprom International SA subsidiary Gas Project Development Central Asia AG, has let a contract to Versalis SPA—the chemical subsidiary of Italy’s Eni SPA—to provide technology licensing for its previously announced grassroots gas-to-chemicals complex based on methanol-to-olefins (MTO) technology in the Karakul area of southwestern Uzbekistan’s Bukhara region (OGJ Online, Sept. 1, 2020).

As part of the contract, Versalis will deliver licensing of its proprietary low-density polyethylene (LDPE)-ethylene vinyl acetate (EVA) technology to Enter Engineering Pte. Ltd.—one of the project investors—on behalf of Jizzakh Petroleum, which will own and operate the MTO gas-to-chemical complex, Eni and Versalis said.

With participation from Versalis’s US-based partner Engineers and Constructors International Inc. (ECI Group)—which specializes in design, engineering, procurement, and construction of polyolefins plants—the LDPE-EVA swing unit will be designed for a maximum EVA-equivalent production capacity of up to 180,000 tonnes/year, according to Versalis.

Details regarding a value of the technology licensing contract and the entire scope of work to be executed for the new LDPE-EVA swing unit by the Versalis-ECI Group partnership were not disclosed.

Project background

The latest contract award follows the September 2020 confirmation of Jizzakh Petroleum as a partner in the MTO gas-to-chemicals project, which formed in May 2019 upon Uzbekneftegaz’s entrance into a quadripartite agreement with JSC Uzkimyosanoat, Enter Engineering, and Air Products and Chemicals Inc. on basic conditions for development of the chemical complex.

Selected for siting in Bukhara due to its proximity to competitive feedstock, energy supplies, suitable infrastructure, and key export markets across Europe and the Asia Pacific, the proposed complex will process 1.5 billion cu m/year of domestic Uzbek natural gas to produce 500,000 tpy of high-quality polymers, including LDPE, EVA, polyethylene terephthalate, and polypropylene.

Preparatory stages of marketing analysis and feasibility studies for the complex were completed by IHS Markit, Nexant Inc., and John Wood Group PLC’s Amec Foster Wheeler, the latter of which selected the optimal option for the complex’s proposed configuration.

The planned $2.8-billion project comes as part of Uzbekistan’s plan to diversify its economy, develop domestic industries, reduce product imports, and enable the country to monetize its natural gas resources via production of export-oriented, high-value products, according to Jizzakh Petroleum.

Project status

In September 2020, Jizzakh Petroleum said final selection of a main technology licensor for the project was under way, after which front-end engineering design for the proposed complex was scheduled to begin.

While neither Jizzakh Petroleum nor its partners have confirmed award of the complex’s main MTO technology licensing contract, work to develop the project remains ongoing despite challenges presented by the COVID-19 pandemic, according to a Dec. 15, 2020 release from MOE.

Details regarding a definitive timeframe for the project, however, have yet to be revealed.