Malaysian media talks possible return of Petronas to Uzbek oil & gas sector

Oil&Gas Materials 17 September 2018 11:41

Baku, Azerbaijan, Sept. 17

By Fikret Dolukhanov – Trend:

Bilateral relations between Malaysia and Uzbekistan can be expanded through increased trade, economic and investment cooperation, including through resumption of the presence of Petroliam Nasional Berhad (Petronas) in the oil and gas sector of Uzbekistan, said the article in the Malaysian national information agency Berita Nasional Malaysia (BERNAMA).

According to the author of the article, based on the current political and economic spheres in both countries, it was imperative that Petronas re-established its footprint in Uzbekistan after significant reforms were adopted by the two-year-old government of Uzbek President Shavkat Mirziyoyev.

Since the introduction last year of a special decree providing free currency conversion of legal entities and individuals, Uzbekistan’s investment climate has become more attractive.

The publication emphasizes the fact that the oil and gas sector plays a key role in the development of the national economy of Uzbekistan. To date, along with investment projects, the republic offers foreign investors to purchase a state share in the companies of the sector for modernization of existing production capacities and introduction of energy efficient technologies and advanced foreign experience.

Petronas previously participated in implementation of a number of projects in the oil and gas sector of Uzbekistan. In 2008, Petronas and Uzbekneftegaz signed an agreement on the Surkhan investment block in the Surkhandarya region.

In 2010, the government of Uzbekistan and Petronas signed a production sharing agreement (PSA) to develop oil and gas fields of the Boysun investment block for a period of 35 years.

However, as early as May 2011, Petronas withdrew from the international consortium for exploration and development in the Uzbek part of the Aral Sea in the framework of the PSA, and in June 2011 reduced its share from 33.3 percent to 11 percent in the construction of a plant for production of synthetic fuel in the south of Uzbekistan.

In April 2013, Petronas ceased exploration work on the investment block in the Surkhandarya region in the south of Uzbekistan due to optimization of business in the republic. In May 2014 the company withdrew from two PSAs in Uzbekistan - Baysun investment block and Ustyurt.


Follow the author on Twitter: @FDolukhanov