8562.34 USD +26.60

9731.96 EUR +165.96

135.34 RUB +2.77

10908.4 GBP +161.92

21:31 / 22.05.2019 225

JSC Uzbekneftegaz to be split up into three separate companies

Photo: Denis Sinyakov/AFP via Getty Images

Bloomberg publication has published an article on the process of reforming the oil and gas industry in Uzbekistan. The material is based on an interview with the chairman of the company Bakhodirjon Sidikov.

As the author of the publication Zulfugar Agayev notes, the goal of reorganizing the JSC Uzbekneftegaz is to improve the efficiency of the oil and gas sector, increase its transparency and attract foreign capital.

According to the Bloomberg journalist, the process of such a major reform of the oil and gas industry is connected with the completion of self-isolation of Uzbekistan, which lasted several decades. There are also such weighty factors as the fact that Uzbekistan is the most populous country in Central Asia and one of the three largest natural gas producers in the former Soviet Union.

“The government has stepped up efforts to attract additional foreign investment, since it aims to increase gas production up to 17% by 2025,” the article notes. 

The JSC Uzbekneftegaz will be split up into three separate companies until the end of this year. One will produce gas and oil, as well as manage refineries, the second will manage pipelines, and the third will control gas distribution. 

It was noted that the JSC Uzbekneftegaz attracted $1.2 billion in foreign direct investment (FDI) in the first four months of 2019, which is twice more than the original target ($550 million).

“Uzbekneftegaz plans to pump 43 billion cubic meters of gas this year. The country as a whole expects to increase production to 63.6 billion cubic meters, from 60 billion in 2018, and is targeting 70 billion by 2025,” the article says.

In addition, there is an active partnership with world leaders in the sphere - PJSC Lukoil, PJSC Gazprom, China National Petroleum Corporation are already taking part in the gas production process in Uzbekistan. Negotiations are underway on behalf of the government with BP PLc and Total SA.