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Uzbekistan|business|May 29, 2017 / 10:24 AM
Uzbekistan to increase its refining capacity by 50%

AKIPRESS.COM - Uzbekistan revealed in late April that it had begun building a new $2.2 billion oil refinery that would produce fuel for sale domestically and abroad, OilPrice.com reports.

Official news sources stated perfunctorily that oil supply agreements had already been reached with Kazakhstan and Russia, although the finer details still in fact need to be decided.

The refinery being built in the Jizzakh province, which lies adjacent to the South Kazakhstan Region, is being designed to process up to 5 million tons of oil annually, an almost 50 percent increase on Uzbekistan’s existing refining capacity. It will when completed turn out 3.7 million tons of gasoline, more than 700,000 tons of aviation fuel and 300,000 tons of associated products. Completion of the project is slated for 2022.

The location was chosen with supplies from the north in mind. A representative with state-owned holding company Uzbekneftegaz told RIA-Novosti news agency earlier this month that a 95-kilometer pipeline is to be built to plug into an existing route from Siberia to southern Kazakhstan.

“We have agreed with Kazakhstan to extend the [3,100-kilometer] Omsk-Pavlodar-Shymkent pipeline into our territory. It will be sufficient to build 95 kilometers worth of pipeline, and then [5 million tons of oil per year] will flow into Uzbekistan," the company representative said.

The unnamed Uzbekneftegaz official may have been running ahead of himself by implying that all the oil for the Jizzakh refinery would come from Russia and Kazakhstan, but the remarks are suggestive all the same.

Building the pipeline will obviate the current reliance of railway transportation and should bring down costs substantially. Uzbekneftegaz estimates that it currently bears costs of between $150 and $250 for every ton of oil imported into Uzbekistan by train.

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