Uzbekistan’s state-owned gas company Uzbekneftegaz and Russian company Stroytransgaz plan to agree a liquefied gas joint venture at the Mubarek Gas Processing Plant in the Kashkadarya region of Uzbekistan before the end of the year, Uzbekneftegaz told Interfax.

’Construction of the enterprise will most likely begin in the first half of 2008,’ a company official said. The project’s preliminary feasibility study has been approved. Once the government resolution is issued, the charter documents will be signed and the JV created, he said.

Stroytransgaz won the tender on construction of the liquefied gas facility at the Mubarek plant in 2004. Initial implementation of the project was planned for early 2005, but the project timetable was revised several times, particularly due to changes in the financing scheme for the project.

The 50-50 joint venture will have charter capital of US$500,000.

The project will cost more than US$221 million, according to the preliminary feasibility study. The plant will have capacity to process 12 billion cubic meters (bcm) of natural gas per year, producing 270,000 tonnes of liquefied gas and 70,000 tonnes of gas condensate.

Virtually all of the treated gas - 11.79 bcm - will conform to international standards and be exported via the country’s gas transportation system. Output will also be sold to Russia’s Gazprom.

Stroytransgaz will provide US$110.53 million in project financing, and Uzbekneftegaz will provide US$45.39 million. The Uzbek reconstruction and development fund will issue US$35.39 million in loans for the project, and a Chinese bank is planning to lend US$30 million.