DUSHABE (Avesta News Agency) – China’s Dong Ying Heli Investment and Development Co. Ltd will start construction of an oil refinery in the Danghara free economic zone, Avesta news agency reported. The design and excavation works and fencing the territory of the future refinery is already done.

It was earlier reported that in October 2014, Tajikistan’s parliament ratified an investment agreement between Tajikistan and China’s Dong Ying Heli Investment and Development Co. Ltd on the construction of an oil refinery in the Danghara Free Economic Zone (FEZ) in Tajikistan.

The project consists of two stages. In the first stage, worth over $160 mln, the refinery’s capacity will be 500 thousand tons per year, and in the second stage, worth over $300 mln, it will reach 1.2 mln tons. The refinery will produce the Euro-3 standard gasoline and diesel fuel.

The Chinese company has already signed agreements with its partners in Afghanistan, Kazakhstan and Russia on the delivery of crude oil to Danghara oil refinery. The investor has purchased German, Italian, and Chinese equipment worth $25 mln, and is working on its delivery to Tajikistan.

The first production unit of the refinery is expected to be commissioned by late 2015. Construction is expected to be completed by the end of 2018.

Tajikistan currently relies on imports, mainly from Russia, to meet domestic need for fuel.

Currently, there are four free economic zones in Tajikistan – Sughd, Panj, Danghara, and Ishkoshim, which provide preferential terms for economic, financial, trade, information, and other activities for investors. The FEZs offer incentives to investors, including preferences on taxation and customs procedures.