Interview on Uzbekistan energy market

1 Apr 2009

Enerdata has just released the new Uzbekistan energy report.

Pierre Buisson, economist at Enerdata in charge of energy market intelligence, unveils the latest energy market evolutions

Why did you choose to provide an energy report on Uzbekistan ?

Uzbekistan is an important gas producer (65 Gm3 produced in 2007), it is the third biggest in the CIS. The country plays a strategic role on the regional gas market, Uzbekistan has a well-developed gas pipes network and exports 70% of its production directly to Russia. Moreover, the country transits gas from Turkmenistan to Kazakhstan, Kyrgyzstan, Russia and Tajikistan.

What is the organisation of the energy sector ?

The energy sector is controlled by two national companies. Since 1999, these companies have been opened to foreign assets; however, the government remains the main shareholder. Uzbekenergo is in charge of the electricity sector by the means of open joint-stock companies. The oil and gas sector is managed by Uzbekneftegaz, which is composed by 6 large companies. Both are opened to foreign investments.

Does the country attract lot of foreign investments in the energy sector ?

The oil and gas sector attract lot of foreign investments in particular on prospection projects. Gazprom is one of the biggest investors in the country, and has planned to invest more than $400m between 2006 and 2011 for the prospection. Others firms, as Petronas, have also launched prospection projects. We can think that with all these projects the country will increase its production level in the next few years.

The gas sector seems to be very dependent to the gas pipe network, are there new projects to improve it?

Two main projects for the construction of gas pipes are planned. Russia and Uzbekistan have signed an agreement for the construction of a new gas pipe with a capacity of 30 Gm3/year to transport Turkmen gas to Russia through Uzbekistan. Two lines of gas pipes will also be built to connect the country to China. The construction of the first one has been launched in 2008 and should be finished in 2009. The construction of the second one should start in 2012.

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