Sasol, Petroliam Nasional Bhd and national oil company Uzbekneftegaz will discuss whether to do an engineering study of the project over about 18 months, according to Lean Strauss, Sasol’s senior group executive for new business development. Sasol hasn’t indicated the cost of the project.

“The next phase will be a strong indication as to whether we’ll go ahead with the project or not,” Strauss said in an interview in Johannesburg today.

The Uzbekistan project “because of its location will be more expensive” than the company’s Qatari plant, which would cost $2 billion and $2.5 billion if built today, Strauss said.

Equipment would have to be transported through two countries as Uzbekistan doesn’t have a seaport, he said. Uzbekneftegaz would supply the gas from an inland reserve, he added.

At the same time, Sasol said that the feasibility study for the Uzbekistan GTL plant is expected to be completed by the end of the third quarter of the 2011 financial year. The financial year of Sasol starts on 1 July and ends on 30 June.

France’s Technip is preparing feasibility study of the project on construction of the plant on production of synthetic fuel. Technip signed a contract on developing feasibility study with Uzbekistan GTL JV, which is operator of the plant, in March 2010.

Uzbekneftegaz national holding company, Petronas International Corporation LTD and Sasol Synfuels International (PTY) Limited signed charter and constituent agreement of joint venture Uzbekistan GTL in November 2009. The preliminary cost of the project makes up US$2.5 billion.

The venture was created in parity terms (33.3%) with preliminary charter capital of US$30 million. Later, the size of the authorized capital will reach US$840 million.

In line with preliminary feasibility study, the plant will process 3.5 billion cubic meters of gas and produce 672,000 tonnes of diesel fuel, 278,000 tonnes of aviation kerosene, 361,000 tonnes of naphtha and 63,000 tonnes of liquefied gas. However, Uzbekneftegaz said that designed capacity of the plant will be increased up to 1.468 million tonnes a year

The project will be financed due to own resources of the venture’s founders, consortium of banks and financial institutions, which issue loans on project financing terms.