Page 9 - bne IntelliNews monthly magazine May 2024

bne May 2024 Companies & Markets I 9
A number of production partners have already signed up to the project and joined the Karakul FEZ to make materials they need for their various industries: Karakulkimyo (fertilisers), Urgaz (flooring and covering), Merganteks (textiles), SAG (flooring and carpeting) and Vero (construction supplies).
There is a lot of upside to domestic demand. A survey by the government on plastics use in Uzbekistan found that the consumption was: 5.8kg per capita per annum for PE;
5.3 for PP; and 4.4 for PET.
Those are all multiples lower for use in the most advanced Western economies. For example, even in Turkey the consumption of PP is 23kg per capita per annum according to Boston Consulting group.
State of play
While the site remains little more than a field in the desert, construction work is well in hand and the land has been
levelled and prepared for construction of the chemical units that is about to start.
The site is already well served with a nearby rail terminal and water in the Amu Karakul canal. And there is a sizable town nearby that will provide most of the labour, although a worker’s village is being constructed. Specialists will be hired in and accommodated at the site in the village too.
Procurement orders have already gone out for the large specialist pieces of machinery and the 314 tonne reactor has already been made in India by Larsen&Toubro and delievered. Another 500-tonne reactors made by China’s Sinopec – the first time it has made a reactor outside China – is on order and will be ready soon, says technical director Navruzov.
For the next stage the smaller sub-critical equipment is now in process and will be arriving over the next 12 months before main construction work starts in July and August, according to Navruzov.
Azerbaijan doubles down by expanding gas exports to Europe
Seymur Mammadov in Baku
Romania has turned to Azerbaijani gas. The supply contract signed on February 3, 2023 by the State Oil Company of the Azerbaijan Republic (SOCAR) and
the Romanian company Romgaz expired on March 31 of this year. The agreement was for Romania's purchase of 1bn cubic metres of gas. Deliveries were made through the Greece- Bulgaria Interconnector (IGB) from the TAP (Trans Adriatic Pipeline) exit point in Komotini, through Bulgarian territory to Romania, and onwards via the Bulgaria-Romania-Hungary- Austria (BRUA) gas pipeline system. SOCAR expressed a willingness to extend this contract until 2026.
Just after the contract expired, on April 1, the Romanian Minister of Energy, Sebastian Ioan Burduja, visited Azerbaijan. The meetings focused on the prospects of supplying liquefied natural gas from Azerbaijan to Romania, with particular attention to the possibility of producing LNG at the SOCAR terminal in the Georgian port of Kulevi, followed by its transportation to the Romanian port of Constanta. This project is deemed extremely important for strengthening not only Romania's energy security but also that of the EU as a whole, making Romania a transit corridor for Azerbaijani gas into Europe in the process.
After the EU was cut off from Russian gas in 2023, European Commission President Ursula von der Leyen travelled to Baku to
meet with President of Azerbaijan Ilham Aliyev, and they signed off on a 10 bcm supply deal to shore up Europe’s gas supplies.
“The European Union has therefore decided to diversify away from Russia and to turn towards more reliable, trustworthy partners. And I am glad to count Azerbaijan among them,” von der Leyen said in a speech to Aliyev during her visit to Baku. “You are indeed a crucial energy partner for us and
you have always been reliable.”
As part of the new energy arrangements, in October 2022,
a memorandum was signed in Bucharest between SOCAR
and Romgaz to develop a technical and economic feasibility study (TEFS) for the transportation of Azerbaijani gas along the Baku-Kulevi-Constanta route. This project could encompass the construction of LNG production and regasification plants in Kulevi and Constanta respectively, along with the creation of other necessary infrastructural facilities. The TEFS of the project is expected to be completed within the current year, reaffirming Romania and Azerbaijan's commitment to deep energy cooperation amidst the remake of the global energy market.
However, Romania is far from being the only European destination for Azerbaijani gas, as Aliyev said in a speech at a grand opening ceremony of the Bulgaria-Serbia Interconnector in Nis, Serbia.
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