Uzbekistan regularly pays off gas debts to Russian LUKOIL

Oil&Gas Materials 9 November 2020 14:48 (UTC +04:00)
Uzbekistan regularly pays off gas debts to Russian LUKOIL

BAKU, Azerbaijan, Nov. 9

By Klavdiya Romakayeva - Trend:

Uzbekistan regularly pays off gas debts to LUKOIL Russian Oil Company, Trend reports referring to the Deputy Energy Minister Bekhzot Normatov statement at a press conference.

In March 2019, it became known that Uzbekistan owed LUKOIL $600 million for gas supplies in 2018. The company operates under a production sharing agreement (PSA) in the Kandym–Khausak–Shady–Kungrad (natural gas fields in Uzbekistan) and South-West Gissar projects.

The debt was formed due to the fact that Uzbekistan took part in the gas to the domestic market, although the terms of the PSA provide for the export of the entire produced volume of gas.

Behzot Normatov stated that the main task of Uzbekistan’s government is to provide the population with gas.

“There is a big difference between prices for households and exports. Despite this, at the time when there was a need, gas was purchased from LUKOIL and sent to the domestic market. Due to the large difference in price, there was a debt,” he explained.

LUKOIL and Uzbekistan agreed to restructure the debt over two years in equal monthly payments, as well as to supply LUKOIL five billion cubic meters per year to the domestic market of the country at a 12.5 percent discount to the weighted average export netback on prepayments.

Earlier, Bekhzot Normatov said that in 2020 LUKOIL sold about five billion cubic meters of gas to the domestic market of Uzbekistan at a price lower than the export price.


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