Jizzakh Petroleum JV LLC, a joint venture of JSC Uzbekneftegaz and Gazprom International SA subsidiary Gas Project Development Central Asia AG, has entered a memorandum of understanding (MOU) with Russia’s Gazprombank (Joint Stock Company), State Development Corp. VEB.RF, and the Russian Agency for Export Credit and Investment Insurance (EXIAR) for financial backing of the operator’s proposed 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).
Signed on June 4, the four-sided MOU establishes a framework for potential future cooperation between the parties that covers an initial $800-million financing of the planned $2.8-billion MTO complex, including insurance of risk related to the project, Jizzakh Petroleum said.
Support from Gazprombank, VEB.RF, and EXIAR comes amid the operator’s plan to source a considerable volume of equipment, materials, and services for the project from Russia, according to Nigora Ibadova, Jizzakh Petroleum’s director for strategic development.
The MOU follows the early-2021 contract award to Versalis SPA—the chemical subsidiary of Italy’s Eni SPA—to provide licensing of its proprietary low-density polyethylene (LDPE)-ethylene vinyl acetate (EVA) technology for the MTO complex’s LDPE-EVA swing unit, which will be designed for a maximum EVA-equivalent production capacity of up to 180,000 tonnes/year (OGJ Online, Feb. 3, 2021).
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 (PET), and polypropylene (PP).
To become the core of Uzbekistan’s future gas chemical cluster—which will be Central Asia’s first special economic zone—the MTO complex forms 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.