An ambitious project to build a gas-to-liquids plant in Uzbekistan — the fifth such facility in the world — has exceeded an overall 75% completion mark, writes Vladimir Afanasiev.

The country’s authorities have issued sovereign guarantees to international banks to secure financing for the $3.6 billion project, which they say will help fulfil a national goal of achieving energy independence.

The GTL plant, built almost entirely from imported components and based on South African company Sasol’s technology, aims to convert excess produced gas into liquid fuels.

The facility also complements the country's ambition to monetise a larger share of produced gas by sending it to processing plants for the manufacture of polymers, rather than exporting it.

Once operational, the plant is set to process about 3.6 billion cubic metres of gas per year produced from the Shurtan field and purified at a nearby gas chemical facility, and convert it mainly into jet fuel, diesel and naphtha.

According to Bekzod Usmanov, a department director at operator Uzbekistan GTL, construction activities are set to be completed by the end of the second quarter next year.

Commissioning of the facility is set to continue for the most of the third quarter, with the plant expected to become operational in the fourth quarter of 2020.

Usmanov said the operator will not be involved in marketing activities, with state-owned Uzbekneftegaz being responsible for delivering gas to the facility, covering its operating costs and offtaking the resulting output.

Earlier this year, Uzbekneftegaz signed an agreement with a banking consortium that agreed to provide a $2.3 billion loan for the project. The consortium includes state-backed Export-Import Bank of Korea, China Development Bank and private financial institutions such as Credit Suisse, Russia’s Gazprombank, and Japan’s MUFG Bank.

According to Uzbekistan's Energy Minister Alisher Sultanov, the plant will help the country reduce imports of oil from Kazakhstan and Turkmenistan — a total of about 30,000 barrels per day in recent years.

This is seen as a strategic goal for Uzbekistan, which today is capable of fully satisfying domestic gas demand but cannot produce sufficient volumes of oil.

Sultanov has dismissed concerns about the facility's high cost and uncertain economic returns in a country with an economy that is set to undergo significant changes in the next several years.

He insists that the positive economic model of the GTL project has been repeatedly verified in the due-diligence process.

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Uzbek GTL plant on track for 2020