South Korea and Uzbekistan sign agreement on allocation of $2.5 billion loan
2012-05-21 15:47:24
Uz-Kor Gas Chemical, an Uzbek-Korean joint venture, and its creditors signed key financial documents on project financing for about $2.54 billion in Tashkent on May 19 within implementation of project on integrated gas extraction and oil-chemical complex with the cost of $3.9 billion.
Signing of the documents is the main stage of the project, which will allow Uz-Kor Gas Chemical and its contractors to start construction of the complex. This is the first example of implementation of large-scale project based on long-term project financing for Uzbekistan and largest, currently, project financing in oil-chemical industry in the CIS area.
Signed documents envisage allocation of financing with limited regress right for the project sponsors and the loan is issued for 16 years.
Uz-Kor Gas Chemical is a project company. Uz-Kor Gas Chemical was founded by Uzbek and Korean companies in May 2008 to develop, finance, construct and exploitation of integrated gas and oil processing project in Ustyurt region of Uzbekistan.
Uzbekneftegaz owns 50% stake in the joint venture, while Uz-Kor Gas Chemical Investment holds 50% share. Korea Gas Corporation (KOGAS), Honam Petrochemical and STX Energy are Korean founders of the venture.
Uz-Kor Gas Chemical will produce and sell gas in market of Uzbekistan and produce gas chemical goods: polyethylene of high density, polypropylene and pyrolized gas and mazut for internal and external markets.
First Deputy Prime Minister and Finance Minister of Uzbekistan Rustam Azimov stated that the project is important for economy of Uzbekistan. He said that the project is serous foundation for transfer of Uzbekistan to "knowledge economy".
He said that the project will help Uzbekistan to increase exports and create raw base for other industries. He said that the complex will supply raw materials to such industries as chemistry, machinery and semi-conductors, as well as other high technology industries of economy.
He said that the complex will annually process 4.5 billion cubic meters of gas and produce 4 billion tank gas, 400,000 polyethylene and 100,000 tonnes of polypropylene, as well as 100,000 tonnes of pyrolized petroleum.