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SOCAR refuses to reconstruct gas processing plant

Economy Materials 15 September 2014 18:01 (UTC +04:00)

Baku, Azerbaijan, Sept.15

Trend:

The reconstruction of the gas processing plant, operating in the Garadagh district of Baku is economically inexpedient, as its facilities are too outdated, the head of the State Oil Company of Azerbaijan (SOCAR), Rovnag Abdullayev told reporters on Sept.15.

The work on reconstruction of the plant was considered economically inexpedient under the plans for construction of a new Oil and Gas Processing and Petrochemical Complex (OGPC) in the Garadagh district.

It is planned to commission a gas processing plant with the capacity of 12 billion cubic meters per year, further, a chemical facility (the capacities of the polyethylene and polypropylene production facilities will be 800,000 metric tons and 300,000 metric tons, respectively) and an oil refinery with the capacity of 8.5-9 million metric tons.

The cost of the project for construction of the OGPC is estimated at $14.4 billion taking into account the interest payments on loans.

Some $6.1 billion of the total volume of project expenditures will fall to the oil refinery, $3.6 billion - gas processing plant and power generating unit, $2.6 billion - petrochemical complex and the remaining $2.1 billion will fall to the payments on loans.

It is planned to implement some 30-40 percent of the project with the equity, and the remaining part of the work will be carried out by using borrowed capital. The payback period of the project will last 4.5 years.

OGPC will be located 60 kilometers from Baku and will consist of three processing enterprises and a thermal power plant (TPP).

The first stage of the project will be implemented in two years, while the entire project will be completed in eight years.

It is planned to start the construction of the gas processing plant in 2015. The plant will be ready for operation in 2019 and the oil and gas facility will be commissioned a bit later (with the interval of six months). All facilities of the refinery will be commissioned in 2023.

The demand of the Azerbaijani population and production facilities for the purified natural gas will be fully provided by the gas processing plant.

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