Page 7 - FSUOGM Week 05 2020

FSUOGM COMMENTARY FSUOGM
of 1,350 tonnes of oil had already been received at the plant, he said.
Finding a commercially feasible means of sending oil to the Danghara re nery has been the project’s main stumbling block over the years. New re ning ventures in other Central Asian states have encountered similar di culties with oil supply logistics, such as Uzbekistan’s plan to build a third re nery in Jizzakh, which was put on hold last year. e Danghara project has been beset by other problems as well, including issues with nancing and the late arrival of equipment.
Fuel independence
Tajikistan currently consumes around 1.6mn tonnes of fuel each year. For many years a er its independence from the USSR in 1991, it contin- ued to buy all its fuel from Russia.
e situation changed in 2010, when Mos- cow decided to re-introduce export duties on these products. e move prompted authorities in Dushanbe to lay plans for the construction of a series of mini-re neries across the country. Among the completed plants was a 2,000 bpd facility in Shahrinav, west of Dushanbe, which started up in 2013. Another 1,000 bpd plant was built that year near the Tajik capital by unnamed private investors, and a 1,400 bpd facility was commissioned in the western Ferghana valley in early 2016.
How much oil these plants are actually
processing is unknown, however, given the stated issues with oil supply.
Russia began providing Tajikistan with quo- tas of duty-free fuel once again in early 2014, de ating Dushanbe’s ambitions of building up a domestic re ning industry. On the surface, this move merely aimed to protect the market share of Russian companies from rival suppliers in Kazakhstan and Turkmenistan. But it also served a broader geopolitical purpose. Moscow o en uses the o er of cheap fuel supplies as diplomatic leverage in neighbouring states. In Central Asia, Russia is fearful of ceding further in uence to China, which has backed a number of energy projects across the region besides the Danghara re nery.
Economic sense
Delays suggest that Dong Ting Heli has so far been unable to nd a means of operating the Danghara re nery pro tably. On the one hand, it has struggled to acquire oil at a low enough cost, and on the other, duty-free Russian fuel imports have driven down fuel prices in Tajikistan.
If previous statements by the authorities are to be believed, the re nery has been ready to operate for more than a year, if not longer. ere is therefore little reason for con dence that oil supply arrangements will be nalised in time for the plant to start up in March, as the government has claimed. ™
Week 05 05•February•2020 w w w. N E W S B A S E . c o m P7