Uzbekistan gets $2.54 bln in loans for gas project

ALMATY, May 21 (Reuters) - Uzbekistan has signed a deal with a consortium of foreign banks to obtain loans worth a total of $2.54 billion to build a gas and chemicals complex on its Surgil field, state oil and gas company Uzbekneftegaz said.

Uzbekneftegaz said in a statement the signing ceremony had taken place in the Uzbek capital Tashkent on Saturday.

“The construction of the Ustyurt gas chemical complex is the first project of such scale to be implemented in the petrochemical sector on the basis of long-term project financing not only in Uzbekistan, but in the entire territory of the CIS,” the company said in a statement posted on its site,

The total cost of the project is $4 billion, it said. South Korean firms KOGAS, Honam Petrochemcial and STX Energy, together with Uzbekneftegaz, would contribute more than $1.4 billion to the project, it said.

A consortium of foreign banks, including the Asian Development Bank, the Export-Import Bank of Korea, China Development Bank and others, would provide loans for a total of $2.54 billion for 16 years. The Export-Import Bank of Korea alone contributed $1 billion to the project, Uzbekneftegaz said.

The Asian Development Bank has said it approved its part of project financing in January.

The construction of the gas and chemical complex and development of Surgil and other local fields is to be realised by Uzbek-Korean joint venture Uz-Kor Gas Chemical, in which Uzbekneftegaz holds 50 percent. The other half is held by Honam Petrochemical and STX Energy.

From 2016, the project on the Ustyurt plateau will allow annual production of 4.5 billion cubic metres of natural gas, 400,000 tonnes of high-density polyethylene, 100,000 tonnes of polypropylene and 110,000 tonnes of pyrolized gasoline, Uzbekneftegaz said. It will also create over 1,000 jobs. (Reporting by Dmitry Solovyov; Editing by Robin Paxton and Hans-Juergen Peters)