Uzbekneftegaz Taps Russian Funds for Drilling
Uzbekistan's national oil company Uzbekneftegaz announced on November 5 it had opened a €40mn ($48mn) credit line with Russian state development bank VEB.RF to fund the purchase of Russian equipment and services for drilling and exploration operations.
The equipment and services will be used in the drilling of 150 wells in Uzbekistan in 2021, as well as various capital repairs.
Providing the credit line will "create opportunities for Russian exporters to expand supplies to the promising oil and gas market of Uzbekistan," VEB.RF's deputy chairman Daniil Algulyan said in a bank statement. He did not say which Russian suppliers would benefit from the funds.
Since president Shavkat Mirziyoyev assumed power in late 2016, Uzbekistan's government has sought to expand gas production by opening the sector up to foreign investors and implementing a series of reforms. But progress has been slow and growth targets have not been met.
National gas output fell 19.6% in the first nine months of this year to 44.88bn m3, according to state statistics, mainly owing to the impact of the coronavirus pandemic. Uzbekistan sells some gas to China, and Beijing cut imports of central Asian gas significantly in the early part of the year after lockdown measures triggered a slowdown in demand.