Uzbekistan's state-owned oil & gas concern Uzbekneftegaz JSC has signed loan agreements amounting to €1.1 billion (US$1.28 billion) with three German banks to support the the expansion in production capacity of the Shurtan Gas Chemical Complex. The debt package includes €500 million from Deutsche Bank, €300 million from Landesbank Baden-Wuerttemberg, and €300 million from Landesbank Hessen-Thüringen Girozentrale (Helaba).

The total cost of the Shurtan GCC Upgrade Project is US$1.8 billion, comprising debt plus US$600 million of equity from Uzbekneftegaz.

The Central Asian country has set ambitious energy targets, and attracting substantial international capital is one of the best measures of the progress being made, says Minister of Energy Alisher Sultanov.

Uzbekneftegaz JSC chairman Mehriddin Abdullaev adds: "The expansion of production capacity at the Shurtan Gas Chemical Complex – the flagship of Uzbekistan’s gas chemical industry and a key polymer producer in the region – is another step towards achieving our goal of increasing volumes of deep processing of hydrocarbon raw materials to produce petrochemical products with high added value.“

The debt will be insured by Euler Hermes (Germany), SACE (Italy), Atradius (the Netherlands) and other European export credit agencies.

A further agreement has also been signed between Uzbekneftegaz JSC and the New York-headquartered international law firm White & Case LLP.

The expansion in production capacity at Shurtan GCC will contribute 280,000 tonnes per year (tpy) of bimodal polyethylene, 100,000 tpy of polypropylene and 50,000 tpy of pyrolysis distillate. The raw material base for the projected expansion facilities at Shurtan is synthetic naphtha, which will be produced from Uzbekistan GTL Plant.