Friday, 18, January, 2019

"It would be no exaggeration to say that during the years of independence, a short period in historical terms, we have gone through a path that is worth centuries, and today Uzbekistan has become a modern and dynamically developing country.

In all fields there are evident results of full-scale works, including a cardinal transformation of the appearance of our country, its cities and villages, the ever-growing welfare of the population, performed by our dedicated and courageous people - the people with strong will, who know the true value of a free and independent life, who have become the masters of their land, their own destiny. Tell me, dear friends, would it be possible to achieve such high goals without independence? There is only one answer: no, definitely not. "

Islam Karimov

Targeted measures are the key

In his article "20 years of independence: Uzbekistan's economy is getting diversified, leaving behind the Soviet legacy", the expert of the Institute of Central Asia and the Caucasus at Johns Hopkins University (USA), Dr. John Daly wrote: "Uzbekistan has achieved great success, but there were also setbacks during the transformation but the country’s future is bright. Compared to its post-Soviet neighbors Uzbekistan’s economic indicators have over the time become quite impressive. Western economists who in 1991 prognosticated a "dim" future for Uzbekistan, further named the country’s success as the "Uzbek mystery", explaining Uzbekistan’s achievements by favorable economic conditions, such as the prevalence of agricultural output, low level of initial industrialization and abundance of natural resources." This interpretation suggests that many foreign economic experts were unable to identify the key essence of the "Uzbek mystery". There is no doubt that the abundance of natural resources played an important role in addressing the enormous socio-economic problems. But here a question arises: why it was not possible to solve these problems during the 70 years of the Union? Abundant raw materials, in the case of for example of Karakalpakstan have not suddenly emerged from nowhere after the 1991, therefore the success of our country in the implementation of socio-economic reforms is primarily due to concrete actions.

If we talk about Karakalpakstan, the problem of the shrinkage of the Aral Sea reached a catastrophic scale as early as in the 60s of the last century. For 30 years, scientists have wrestled over how to prevent the Aral Sea tragedy, but no intelligible actions followed. Meanwhile, residents of coastal areas from year to year found themselves farther away from the waters, which were leaving them in the midst of a desert without the normal conditions to live and to work. Whole dynasties of fishermen were out of work. Occasionally they were provided with humanitarian aid, and were told that the situation is really critical, and scientists were striving to find the solution, but the things remained as they were.

Two years ago, in the address to the participants of the International Conference "Development of cooperation in the Aral Sea region to mitigate environmental catastrophe," the President Islam Karimov said: "I deeply regret to say that, today it has become clear that it is unlikely to entirely restore the Aral Sea basin. The most crucial task of the present time is to reduce the devastating impact of the Aral crisis on the environment and livelihoods of millions of people residing in the Aral Sea region, including through the implementation of the well thought-out, targeted and adequately funded projects. "

The extent to which Karakalpakstan has transfromed in a quarter of century is the evidence that the task voiced by the head of state from the first days of independence has been the top priority. It was during this time under the leadership of President Islam Karimov that the problem of the Aral Sea was actually divided into two components: environmental and social. The country's leadership initially proceeded from the fact that any positive changes in the ecology of the region will require a lot of time and that to radically change the conditions of the local population is a must, therefore one should not in any case mix these problems. As the President said in the same address: "We have no right to allow the emergence among the people living here of the sense of hopelessness, and it is our duty - to provide them with all the opportunities for a decent life, for the development of their own business, creating new jobs and sources of income." The railway line Navoi - Uchkuduk - Sultanuvaystog - Nukus, the highway Guzar - Bukhara - Nukus - Beyneu, the only one of its kind in Central Asia, Kungrad Soda Plant, Hodzheyli glass factory, dozens of large textiles and building materials enterprises, the revived agriculture, in which once unthinkable for the culture of this region such as persimmons and pomegranates are now grown, and, finally, the Ustyurt Gas Chemical complex - all this was the fruit of realization in Karakalpakstan in the years of independence of the "Uzbek model" of economic development.

Without any doubt, if such measures had been taken during the previous regime, the drying of the Aral Sea would more likely have remained exclusively an environmental one. In this precisely lies the very essence of the "Uzbek mystery ": for the resolution of problems and balanced development of territories, the country's leadership is taking urgent targeted measures, instead of idle talking, as it was the case before. It is during the years of independence that the territories within several dozen kilometers of radius from the original southern shore of the Aral Sea have turned from zones of environmental disaster into the concentration of promising hydrocarbon fields. East Berdakh, Uchsay, Surgil, Shagyrlyk, Northern Aral - all these and many other oil and gas fields have been explored and developed at the dawn of the new millennium. It is from here, from the Surgil, Eastern and Northern Berdakh fields that one of the Central Asia's largest facilities of its kind - Ustyurt Gas Chemical Complex takes its origins.

Symbol of cooperation

Recordbreaking in terms of scope, deadlines and amount of investments - the construction of a new gas-chemical complex has once again proved that Uzbekistan's economy will never be raw material economy. Deal of the Year in 2012 in the petrochemical industry according to the international edition - Project Finance International Magazine, the Deal of the Year in 2013 - according to PFI Thompson Reuters and PFM Euromoney the international edition of information and analytical agencies, The Deal of the Year in 2014 - according to the international Infrastructure Journal. Each stage of the realization of the largest investment project in the country's history aimed at processing of hydrocarbon raw materials was a sensation for the international oil and gas community. And it is not surprising, because some five years ago on the site of the UGCC there was virtually flat and sandy plain, and the main source of hydrocarbons - the Surgil field existed only on geological maps. The development of the latter only began in 2008. That is a project worth $ 3.9 billion (one of the most expensive industrial projects in the history of the world) has been realized from scratch.

Such companies as Kor-Gas Investment Malaysia, Korea’s Exim Bank, Korea Development Bank, Asian Development Bank, China Development Bank, the Fund for Reconstruction and Development of Uzbekistan, Korean Credit Insurance Corporation, the German export credit agency "Hermes" and the banks KfW , Bayern LB, Siemens Bank, the Swedish export credit agency EKN, as well as the banks' of Nordea and SEC, the Swiss financial holding company Credit Suisse Group and the Dutch bank ING participated in funding and insurance coverage of the project.

The nature of such an active and multi-faceted investment in the oil and gas industry was clearly clarified by the President of Lukoil Vagit Alekperov during his working visit to Uzbekistan in the framework of the latest International Exhibition "Oil and Gas of Uzbekistan - OGU":

- Of course, everyone understands that currently, due to a sharp drop in oil prices and, consequently the gas prices, the world’s oil and gas industry is experiencing not the best of times, which, to put it mildly, does not stimulate the investments in the sector. However, the unique conditions created in Uzbekistan allow the investors to take decisions for the development of oil and gas projects, even in such a difficult period.

The immediate participants in the construction process of Ustyurt GCC of JV "Uz-Kor Gas Chemical" were NHC UzbekNefteGaz, the South Korean companies - Samsung Engineering Co. Ltd., GS Engineering & Construction Corp., Hyundai Engineering Co. Ltd. It is no accident that two years ago, during the official visit of the President of the Republic of Korea Park Geun-hye to Ustyurt Gas Chemical Complex, as a mega-project at the international level, has been named the symbol of the Uzbek-Korean cooperation. It is symbolic that such an ambitious project was completed in October last year - three months ahead of schedule.

- The complex consists of five main plants and the external infrastructure facilities - gas separation, ethylene, polyethylene, polypropylene plants, as well as electricity supply plant, - says the First Deputy Chairman of JV "Uz-Kor Gas Chemical" Tulagan Juraev. - The production process is arranged as follows: gas condensate is supplied from Surgil, East and North Berdakh fields to the gas separation plant. There, it is separated into fractions: methane, ethane, liquefied petroleum gas and condensate, and then the valuable components are sent to the ethylene plant, namely to pyrolysis furnace for the next stage of deep processing. Gas is separated under the high temperature, followed by high-tech multistage cooling and separation processes. The end product is a propylene and ethylene. The first is sent to the high density polyethylene plant, and the latter to polypropylene plant.

It might seem that it is not that complicated, however in fact it is such a high-scale and science-intensive process with complex internal infrastructure, that there arises only one question: how this was made possible in the middle of a desert? According to the engineers’ calculations, the system of Ustyurt Gas Chemical Complex uses almost one and a half thousand pieces of various equipment, units and devices. Every second the complex’s central control unit receives more than 22 thousand different readings and signals from the instrumentation, installed in technological areas.

The profitability of the complex, including the operation of three gas fields is colossal. And it's not only due to the fact that the proven gas reserves in Surgil, North and East Berdakh fields will be enough for dozens of years (!).judge by yourself: It consumes electricity (and only in the fields) and water for industrial and technological needs, and supplies purified gas, polyethylene and polypropylene to domestic and foreign market. Regarding the electricity supply directly to Ustyurt Gas Chemical Complex, this function is performed by the energy supply plant. This means that this process is completely autonomous.

- The total capacity of the installed three gas turbine generators from the worldwide renowned Siemens exceeds 70 MW/hour, - says the head of the electricity supply plant, Boyburi Koraev. - Every day the generators produce more than 1.5 thousand megawatts of electricity and some of it is supplied to the grid of JSC UzbekEnergo. If we take that a family of two or three on average consumes five kilowatts of electricity a day, then the volume of electricity supplied to the UzbekEnergo’s grid would be enough to supply more than 200 thousand households. Furthermore, the plant satisfies the complex’s needs in gaseous nitrogen, technical air,  high-pressure steam, and re-treated water.

At design capacity

- Perhaps the main question that people may ask about: what is polypropylene and why the mastering of its production in our country has caused such resonance in the world? - says the process-engineer of polypropylene plant Humayun Khalmuratov. - In simple terms, polypropylene along with a polyethylene is one of the materials, without which the modern industry, the production of non-food consumer products simply can not exist. Previously polypropelene in its entirety was imported, and thus it is not surprising that obtaining in November 2015 for the first time in the country ‘s history of the first polypropylene caused such resonance. 13 grades are already being produced. Polypropylene FQ 130 (solid, transparent and glossy polypropylene) is designed for the production of adhesive tape, packages, all kinds of films and other products with a similar structure. Y 120A gared is used in the production of flat yarn, it is particularly valuable in the global textile market. Polypropylene J150 (high strength) is used, for example, in the manufacture of washing machines. AE-3528 grade (strong and heat resistant) is used for the manufacture of, in particular, of bumpers and other vehicle exterior construction elements. And so on. The mastering of production of new grades does not end with this, as the optimization of the entire production process is ongoing.

The plant has already reached its design capacity - 240 tons of polypropylene per day. To this day 50 thousand tons of polypropylene have already been produced. There is a similar pattern at the high density polyethylene plant, it has reached the design capacity which is around 1,161 tons per day. About 200 thousand tons of polymers have been produced since the end October last year to this date.

In December 2015, the complex started to export the polymers. About 85 percent of total production goes to the foreign market by rail and by automobile transport, with the start of exports to this date products worth over $ 200 million have been sold. The initial exports period’s geography looks more than impressive - China, South Korea, Russia, Latvia, Kazakhstan, Afghanistan, Turkey, Turkmenistan and Kyrgyzstan.

And, given the existing agreements, this is only the beginning. Firstly, by the end of this year, the share of exports in total sales shall be brought up to 90 percent. Secondly, less than two weeks ago the contract share of NHC Uzbekneftegaz of polypropylene and polyethylene is placed on stock-exchange trades, in which foreign clients are already taking part. In general, according to the project, in the future, the polymer exports geography will further expand to Central and Western Europe, Asia, the CIS. That is, the structure of supplies is expected to expand and change significantly.

City-forming giant

The multi-dimensional effect always gives a rise to a question: what was the main outcome of the project? It is not easy to reply to this question, however the answer is there, and it is obvious. Ustyurt Gas Chemical Complex is not just a mere enterprise, not just an industrial facility - it is an industrial giant that is already actively implementing the its initial city-forming functions. This is one of many, but perhaps the key facility of the northern region, which will help all the local people to forget about the difficulties they had to overcome due to the Aral tragedy. Currently nearly one and a half thousand people are employed by UGCC, more than 300 of them are the graduates of professional colleges.

In order to create the most comfortable living conditions for complex’s employees, a new residential area o ​​ houses on standardized projects has been built in close proximity to it. 140 houses owners have celebrated or will soon celebrate the housewarming. All utilities facilities have been provided, and access roads have been laid and some primary social infrastructure facilities have been erected. In the near future it is expected to start the construction of a secondary school for 400 pupils, a kindergarten for 140 places and modern multidisciplinary clinic for 140 visits per day.

For those who have not yet made a decision to buy a new house, there are three family apartment houses, where 144 families have already settled. Experts on business trips both from regions and from abroad coming in as consultants may be accommodated in a modern hotel. And, of course, no town in the East can do without a dehkan market. Employees of UGCC and visitor specialists do not need to worry about where and how to get food - all the freshest products can always be bought at hand. Very soon subsistence farming will begin to actively develop, but this would be another advantage in terms of not only food security but also in terms of employment.

- At a time when conflicts are occurring all over the world, economic and financial crises are replaced by one another, global unrest and uncertainty are reigning, all of us once again are witnessing that a quarter of a century ago under the leadership of the President Islam Karimov, our country made the right choice. Creation of Ustyurt Gas Chemical Complex is a great holiday for every compatriot. I am overwhelmed with pride that I am a part of this unique project, initiated by the head of our state, - says the process-engineer of the ethylene plant Khursand Matnazarov. - It is a great happiness that, the Uzbek youth, after getting modern education in universities, have a real opportunity to apply the acquired knowledge into practice on such a unique world-scale complex.

About 80 percent of the company's specialists is the youth, with average age of 30-35 years. A comprehensive training and internship program of young professionals is developed for the formation of professional staff. Virtually every employee of the complex was on internship at the Shurtan gas and chemical complex, every third has studied abroad - in South Korea, the United States, Japan, Sweden, the UK, Belgium, France, Germany, Thailand and other countries.

The result of training and education of young specialists of the JV "Uz-Kor Gas Chemical" was the start-up and commissioning, which went smoothly and promptly. This was a clear evidence that our younger generation are in no way inferior to anyone and have fully mastered the advanced technologies and equipment of world leading companies.

About these places, where the arid plain has been replaced by a full life, one will not mention as a zone of ecological disaster. The Aral Sea cannot recovered, it is true, as the head of our state noted, but the lives of thousands of families now will never return to the nightmare of the past. Now they are the ones who enhance the prestige of our independent country in the world, the ones thanks to whom one of the largest industrial projects in the history of gas chemical industry is working at full capacity and thus further strengthens the national economy.

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