Uzbekistan - Country Commercial Guide
Oil and Gas

This is a best prospect industry sector for this country.  Includes a market overview and trade data.

Last published date: 2021-10-10

Overview

Mining, quarrying, and oil and gas are the leading industries of Uzbekistan’s economy, despite the sector’s ever more pressing need for further development and the rising number of renewable energy projects. The country’s hydrocarbon reserves are significant: according to local industry officials, total primary energy reserves (proved and projected) amount to 5.5 billion tons of oil equivalent (toe), including 1.5-1.6 billion toe of natural gas, 245 million toe of oil and up to 3.3 billion toe of coal. However, the past year was stressful for the industry due to a 78% fall in natural gas exports. The industries contributed only 5.7% to the GDP of the country, over 9% to the state budget earnings, 4.4% of export earnings, and employ nearly 180 thousand people. Uzbekistan is the second largest natural gas producer in Central Asia. Accordingly, energy issues remain a high priority in President Mirziyoyev’s agenda. Despite a breakthrough in improving energy cooperation with regional neighbors, interrupted and insufficient electricity and gas supplies remain an issue.  In 2019, the government broke up the national monopoly UzbekNefteGaz into three independent companies focused on production (UzbekNefteGaz), transmission (UzTransGaz), and domestic sales (HududGazTaminot), with the goal of improving transparency and operating on market-based price standards. Implementation of an automated system for monitoring and metering of natural gas started in 2020, and should dramatically improve resource accountability. UzbekNefteGaz and UzTransGaz have been instructed to file for an IPO by 2023. The government also announced plans to halt natural gas exports by 2025 and process all domestic output into higher value-added products: 52 projects worth $9 billion on the deep processing of natural gas are planned to be completed by 2025. It is estimated that realization of these projects will allow the production of $4.1 billion worth of goods, replacing $1.1 billion of imports, and ensuring $1.45 billion of exports. The energy market is gradually being liberalized: customs duties and permits required for the import of liquefied natural gas were abolished in February 2021; a wholesale market of electricity and natural gas will be created for manufacturers and importers and, as the first step, large enterprises have been allowed to import electricity and natural gas starting from August 1, 2021.

 

2018

2019

2020

2021 estimated

Total Local Production

6,350

7,200

3,282

N/A

Cannot be estimated due to uncertainty in global demand.

Total Exports

2,666

2,525

659

N/A

Total Imports

880

928

1,094

N/A

Imports from the US

17

14

41

N/A

Total Market Size*

4,564

5,603

3,717

N/A

Exchange Rates**

8,069

8,839

10,056

10,600

*Total market size = (total local production + imports) – exports
** Exchange Rates = Uzbek soums per $1.
Units: $ millions
Source: The State Statistics Committee of Uzbekistan. Imports from the U.S.  data is from the U.S. census bureau. 

Leading Sub-Sectors

  • Oil and Gas Extraction
  • Support Activities for Mining

Opportunities

U.S. oil and gas companies may bid on contracts to supply services to the country.  Specific fields include consulting, engineering, construction, equipment supply, and management.  The government presently has an increased interest in licensing technologies for oil refining and gas extraction, treatment and processing.  All public sector tenders and technical requirements, specifications, documents, and procedural explanations are available on the website of Uzbekneftegaz and UzTransGaz

For specific opportunities, businesses should review tenders on the company websites, www.tenderweek.com (https://tenderweek.com/), or contact potential partners by phone or e-mail. In general, opportunities exist in fossil fuel field development and exploration; oil and gas-bearing structure analysis; seismic surveys and deep drilling; and construction, expansion and modernization of production facilities.

Resources

U.S. companies and individuals interested in learning more about the oil and gas sector, upcoming procurements, and export opportunities are encouraged to consult the following resources: