Lukoil lets contract for Uzbekistan gas processing plant

Russia’s OAO Lukoil has let a contract to a consortium headed by South Korea’s Hyundai Engineering Co. Ltd., Seoul, for the construction of its long-planned Kandym gas processing plant to be built in southern Uzbekistan, about 520 km southwest of Tashkent.

Russia’s OAO Lukoil has let a contract to a consortium headed by South Korea’s Hyundai Engineering Co. Ltd., Seoul, for the construction of its long-planned Kandym gas processing plant to be built in southern Uzbekistan, about 520 km southwest of Tashkent (OGJ Online, Mar. 28, 2012).

The proposed plant, which will have a capacity of 8.1 billion cu m/year, will process sour natural gas from the Kandym group of fields in the Bukhara region of Uzbekistan to produce treated natural gas, stable gas condensate, as well as solid and granulated sulfur, Lukoil said.

In addition to its previous preparation of front-end engineering design services for the Kandym gas field project, Hyundai Engineering’s scope of work under this most recent contract will include overall detailed design, procurement, construction, and commissioning of the gas processing plant, Hyundai Engineering said in Nov. 27, 2014, release announcing the preliminary contract award.

The total value of the contract for construction of the gas processing plant project, which received final approval from the Uzbek government in November 2014, amounts to nearly $2.7 billion, of which Hyundai Engineering’s stake is 76%, or just over $2 billion, the company said.

While a firm timeline for the project was not disclosed, Hyundai Engineering said it expects the construction period, once under way, to last 44 months.

One of Lukoil’s largest investment projects in Uzbekistan, construction of the Kandym gas processing plant follows the company’s Kandym-Khauzak-Shady-Kungrad project, which Lukoil began to implement in conjunction with state Uzbekneftegaz under an initial 35-year production-sharing agreement that took effect in November 2004 (OGJ Online, Dec. 20, 2004).

Originally due to expire in 2039, the PSA was extended in November 2014 for an another 7 years to 2046, Lukoil said.

The Kandym portion of the Kandym-Khauzak-Shady-Kungrad project follows the Khauzak-Shady area as the second production phase to take place under the PSA (OGJ Online, June 20, 2011) and involves the development of six gas condensate fields, including Kandym, Kuvachi-Alat, Akkum, Parsankul, Khoji and West Khoji, Lukoil said.

More in New Plants