April 19, 2018 / 11:08 AM / 7 months ago

Russia's Lukoil starts up Uzbekistan gas plant for Chinese exports

FILE PHOTO: The logo of Russian oil company Lukoil is seen on a board at the St. Petersburg International Economic Forum 2017 (SPIEF 2017) in St. Petersburg, Russia, June 1, 2017. REUTERS/Sergei Karpukhin/File Photo

(This April 19 story was corrected to show Lukoil raised $660 million loan, not $600 million, in paragraph 4)

BUKHARA, Uzbekistan (Reuters) - Russia’s No. 2 oil producer Lukoil has started operations at a $3.4 billion gas processing plant at its Kandym gasfield in Uzbekistan, which is seen as central to its efforts to boost gas production and exports to China.

The Russian government said in a statement on Thursday that the gas processing complex, with a capacity of 8 billion cubic meters (bcm) per year, had been launched ahead of schedule.

Lukoil has not revealed any data on gas exports to China from Uzbekistan.

Lukoil also said on Thursday it has raised a $660 million loan to finance part of the cost of building the gas plant in Uzbekistan.

Lukoil is working in the country under a production-sharing agreement that accounts for a quarter of all of Uzbekistan’s gas output.

The company plans to double gas production in Uzbekistan to 16 bcm per year by 2020 from 8 bcm in 2017.

Lukoil’s total gas output reached almost 33 bcm in 2017.

Uzbekneftegaz head Alisher Sultanov said last September that Uzbekistan had contracts to export up to 6 bcm of gas to Russia and up to 10 bcm to China per year.

Reporting by Olesya Astakhova; writing by Vladimir Soldatkin; Editing by Adrian Croft

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