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The Cabinet of Ministers of Uzbekistan approved a resolution “On measures on implementation of investment project “Construction of Yuzhniy Kemachi field” on 5 September 2013.
The document was adopted to expand production of hydrocarbon materials due to ensuring full extraction of liquid hydrocarbons from oil and gas condensate field Yuzhniy Kemachi.
According to the resolution, Uzbekneftegaz is implementing an investment project “Construction of Yuzhniy Kemachi field” stage-by-stage.
The first phase of the project (implemented till 2016) envisages construction of objects for mining, transportation, preparation and re-injection of gas to the layer “cycling process” with total investments for US$359.323 million.
Within the second phase of the project, it is planned to construct 37 exploitation wells and booster compression staion.
The resolution said that the first stage of the project will be financed due to own funds of Uzbekneftegaz for US$326.307 million and loan of the Fund for Reconstruction and Development of Uzbekistan (FRDU) for U$33.015 million.
The loan will be used to finance purchase of imported equipment and materials. It will be refinanced through Uzpromstroybank.
The loan will be issued for seven years, including two-year grace period. The interest rate is set at 4% APR, including margin of the refinancing bank at the size of 1% APR.
According to the resolution, Uzbekneftegaz is a debtor and executive body, responsible for implementation of the project, targeted and effective use of the FRDU loan.
The expenses, related to repayment of the FRDU loan, will be covered due to own resources of Uzbekneftegaz.
The Government also approved feasibility study of the first phase of the investment projects.