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Monday 11 March 2013

Uzbekistan Abandons the Construction of Chemical Plant with UAE Money


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TASHKENT (CA-News) – The Uzbek government has pulled out of a $1.34 bln chemical plant deal with the United Arab Emirates (UAE) over a dispute over contract fulfilments, Kazakh media reported on Monday. The deal was first agreed in 2010 between the UAE’s International Petroleum Investment Co (IPIC) and the Uzbek government. The ammonium- and urea-producing plant was expected to be built in the central Navoi region, the location of one of the country’s Special Economic Zones (SEZ).

The two sides reportedly fell out over “reaching the figures that had been set by agreement terms.” The agreement originally anticipated annual production of ammonium to be 900,000 tons and the annual production of urea to be 1 mln tons.

IPIC was expected to provide $268 mln towards the project, while the Uzbek side would have been responsible for the same amount. The remaining $804 mln would have been provided by foreign banks and international financial institutions. 70% of the urea expected to be produced in the plant would have been exported.

In turn, the Uzbek side intended to provide construction of external infrastructure, including power lines, roads and railways necessary for the functioning of the ammonium and urea production complex.

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