WELCOME TO OLTIN YO'L GTL

Consistent activity is being implemented in the country on integrated development of the fuel and energy sector and diversification of energy sources, the GTL project is an example of these.

These days, two units of the main large-size technological equipment with a weight of 350 and 550 tons are on the way of the territory of Uzbekistan. It will be delivered to the construction site of a plant for the production of synthetic liquid fuel (GTL project) in Kashkadarya region in March. The purpose of the new plant is the in-depth processing of natural gas, with the production of kerosene, diesel fuel, naphtha and liquefied gas.

This investment project is being implemented in accordance with the decree of the President of the Republic of Uzbekistan " Production of synthetic liquid fuels on the basis of the Shurtan Gas Chemical Complex at the methane purification base" (No. PP-2706 of December 29, 2016). Currently, the main large-size technological equipment is on its way from Karakalpakstan to Kashkadarya region. Prior to this, through several countries, several thousand kilometers have been crossed through major sea routes and logistic routes of the Republic of Korea to Uzbekistan.

These units – weighing 550 tons, 39 meters long and 6,9 meters in diameter, as well as weighing 350 tons and 25 meters long, will be used in the workshop of the plant for producing synthetic liquid. Thanks to these units, generated synthesis gas (methane + oxygen) will be converted into synthetic liquid fuel as a result of physic-chemical reactions and technological processes – the so-called semi-finished product from which, after a series of processes, the main oil products, such as diesel, kerosene and naphtha will be produced.

To date, the implementation of the project GTL entered the active phase. At the construction site mobilized more than 5000 workers, builders and engineers, involved more than 500 units of construction and special equipment.

Construction of the GTL plant in Uzbekistan continues at the active pace. Overall in the implementation of the contract exceeded 71%. Construction works are being continued at the site of the plant for the production of synthetic liquid fuel in the Kashkadarya region, which has been completed by more than 25%. In total, more than 11,000 units of technological equipment are manufactured for more than 129 plants in 24 countries of the world for the GTL plant under construction in Uzbekistan. Currently, delivery of high-tech and large-sized equipment to the construction site is carried out.

More than 116 sets of high-tech equipment were delivered to the construction site, their installations have already begun. 153 sets have already been directed to the construction site by manufacturers and are on their way to Uzbekistan.

Implementation of the GTL project will provide an opportunity to ensure the annual import substitution of petroleum products in the amount of up to 1,5 million tons.

The raw material base for the plant producing synthetic liquid fuel is the purified gas of the Shurtan Gas Chemical Complex, its volume consists of 3,6 billion cubic meters per year.

It should be noted that the GTL project implementation will provide an opportunity to ensure the annual import substitution of petroleum products in the amount of up to 1.5 million tons. The raw material base of the plant for the production of synthetic fuel - Shurtan Gas Chemical Complex is a methane with an annual capacity of 3.6 billion cubic meters.

Annual production of the plant will be more than 1,5 million tons of high-quality synthetic liquid fuel that complies with the Euro-5 standard, including 743,5 thousand tons of diesel fuel, 311 thousand tons of aviation kerosene, more than 431 thousand tons of naphtha, more than 50 thousand tons of liquefied gas.

The press service of the Ministry of Energy of the Republic

The stable outlook reflects the agency’s expectation that, over the next year, Uzbekistan’s fiscal and external net asset positions will remain strong, albeit decline slightly, due to expected future current account deficits and government borrowing. “We could raise the ratings if monetary policy effectiveness were to improve, for example through a decline in dollarization of the economy. Further diversification of the government’s revenue base or the composition of the economy’s exports would also be supportive of the ratings,” the agency said. “We could lower the ratings if the fiscal or external positions deteriorated, for example if fiscal deficits increased beyond our base-case scenario or if higher-than-expected current account deficits led to an increase in external financing needs. We could also lower the ratings if we observed increasing weakness in key state-owned enterprises (SOEs), leading to growing contingent liabilities for the government,” S&P Global Ratings said. “Our ratings on Uzbekistan are supported by the government’s strong fiscal and external positions. These strengths predominately arise from the government’s large asset position, which stems partly from the policy of transferring part of the revenues from commodity sales to the Uzbekistan Fund for Reconstruction and Development (UFRD),” the statement of S&P Global Ratings said. “Our ratings are constrained by Uzbekistan’s low economic wealth, as measured by GDP per capita. In our view, future policy responses may be difficult to predict, given the highly centralized decision-making process and that accountability and checks and balances between institutions are relatively underdeveloped. Our ratings are also constrained by low monetary policy flexibility,” the agency noted. S&P Global Ratings said institutional And Economic Profile: Reforms have begun to open up the economy but challenges remain Broad-based policy reforms have improved institutions, albeit from a low base, and opened up the economy. “We expect decision-making to remain centralized. GDP per capita remains low, at an estimated $1,200 in 2018. We expect real GDP growth to remain relatively strong, averaging 5% over our forecast period to 2021,” the agency said.

UzDaily

Short-term IDRs of the country in both currencies are assigned by the Agency at the level “B”, the rating of the country ceiling is at the level “BB-”. “Uzbekistan’s rating is counterbalanced with the low level of public debt and data on high economic growth compared to other countries with similar ratings, strong commodity dependence, high inflation, and structural deficiencies in terms of GDP per capita,” the Agency explains. Fitch expects that the country’s economy to grow by 5% in 2018, while this indicator of growth will slow to 4.9% in 2019. The Agency considers, that the growth rate will reach 5.3% in 2020. “The growth will be based on public investments into strategic projects, housing and infrastructure costs,” the report notes. The country’s rating can be upgraded if the progress in strengthening of the macroeconomic stability is occurred. At the same time, a steady decline in foreign exchange reserves and a weakening of the sovereign balance can lead to a negative rating action. Sovereign credit rating is a tool to assess the readiness of the state to meet its financial obligations in prompt and full manner. In July, the government of Uzbekistan attracted a consortium of the banks led by JP Morgan Chase to obtain a sovereign credit rating and issue sovereign bonds. In accordance with the decree of Mr. Shavkat Mirziyoyev, the President, the funds received from the bonds placement will be used for social programs activities and construction of infrastructure. Mr. Jamshid Kuchkarov, the Deputy Prime Minister, Minister of Finance stated in September that the government considers the sovereign rating as one of the ways to diversify sources to attract funds from abroad. Obtaining a sovereign credit rating will contribute to the growth of foreign direct investment, expansion of cooperation with foreign partners, as well as to the creation of favorable conditions for the banks and companies in attraction of the credit funds at the global financial markets at the lower interest rates, the Deputy Prime Minister noted. In November, he stated that after received the rating in the first quarter of 2019, it is planned to issue bonds at the foreign market. In addition to Fitch, the authorities also work with two other rating agencies – Moody’s and Standard & Poor’s. Their ratings are expected before the end of the year.