American-Uzbekistan Chamber of Commerce
Week in Review:
November 23, 2012 - November 30, 2012

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In This Issue:
Water management and Afghanistan the main issues on the EU Uzbekistan political agenda
Kazakh President to visit Uzbekistan in 2013
LUKOIL plans to increase gas production in Uzbekistan in 2012-2015
NGMK to start modernization of its mining equipment in 2013
Uzbekugol to invest US$90m to modernize mining equipment
Development of Small Business in Uzbekistan

Established in 1993, the American-Uzbekistan Chamber of Commerce (AUCC) is a private, non-profit trade association representing interests of U.S. businesses ranging in size from small private enterprises to large, multinational corporations conducting business in Uzbekistan.

Our Mission: To advocate the views of the business community to ensure that private sector positions are considered during the development of key policies that impact American businesses and the future of U.S.-Uzbekistan relations.

Our Objective: To serve the needs of its members by strengthening commercial relations between the United States and Uzbekistan.   


On 29 November, EU High Representative Catherine Ashton and President of Uzbekistan Islam Karimov discussed about Uzbekistan's water management issues, the situation in Afghanistan and political reforms.

According to Ashton, the main issue of the agenda was the regional challenges in Central Asia and in particular the situation in Afghanistan. Ashton and Karimov discussed about the withdrawal of combat troops from Afghanistan in 2014 and the impact that could have in the region. On June 2012, Uzbekistan withdrew from the Russian-led Collective Security Treaty Organisation and according to Fox, Karimov did that move to pursue a more independent and Western policy in military issues. The U.S. in January removed a ban on providing military assistance to Uzbekistan, and on 25 August, Washington launched negotiations with Tashkent, discussing the possible establishment of an Operative Reaction Center in Uzbekistan, which could accommodate warehouses storing weapons and military hardware following the U.S. forces' withdrawal from Afghanistan in 2014.

Regarding water management, Ashton talked about the confrontations between Uzbekistan, Kyrgyzstan and Tajikistan. Uzbekistan, Central Asia's most populous country with approximately 28 million citizens, depends on the rivers that rise in from the other two countries. However, the intention of the neighbours to revive old dams' projects caused a serious political issue between the three countries. Ashton stressed to Karimov the importance of regional co-operation and underlined that the European Union is "ready to provide support for mutually beneficial solutions to water disputes."

Last but not least, Ashton encouraged the President of Uzbekistan to continue promoting the judicial reforms and acknowledge the increasingly important role of civil society.   


Kazakh President Nursultan Nazarbayev will visit Uzbekistan in 2013. Deputy Prime Minister of Kazakhstan Krymbek Kusherbaev made this statement at the 12th meeting of the Uzbek-Kazakh intergovernmental commission on bilateral cooperation, held on Thursday in Tashkent.

He also said that Prime Minister of Kazakhstan Serik Akhmetov will pay a working visit to Uzbekistan in December.

According to the National News Agency of Uzbekistan, the intergovernmental commission's meeting was attended by representatives of ministries and departments, companies of the two countries, working in the areas as foreign economic relations, trade, investment, banking and finance, customs, oil and gas, transport and transport communication, chemistry, agriculture, water management, environmental protection, culture, sports, health, air traffic and etc.

First Deputy Prime Minister of Uzbekistan, Minister of Finance, the commission's Co-Chairman Rustam Azimov stressed the gradual development of cooperation between the two countries, an important legal basis of which are the agreements reached during meetings of the heads of the two states.

Deputy Prime Minister of Kazakhstan, Co-Chairman of the commission, Krymbek Kusherbaev noted that Kazakhstan is a priority for expansion of ties with Uzbekistan.

An important area of mutual relations is cooperation in the field of transport and transport communications and transit.

The meeting participants discussed promising directions of further development of trade-economic and investment cooperation in trade, investment, banking and finance, oil and gas and chemical industries.

In particular, the parties stated that the product nomenclature in the mutual trade turnover could be significantly expanded and diversified. A preliminary agreement has been reached to sign an agreement on transboundary water facilities in 2013 in the field of water and energy resources in the region.   


LUKOIL the Russian national company plans to increase gas production in Uzbekistan two-fold from 4.1 billion cubic meters in 2012 to 8.2 billion cubic meters by 2016, the company said today.

According to the company, gas production in Uzbekistan will hit 4.4 billion cubic meters in 2013 and in 2014, 5.2 billion cubic meters.

According to the report, the company increased gas production by 73 per cent in its projects in Uzbekistan during the third quarter of 2012.

According to the company, the expected growth in the EBITDA index as a result of increased extraction in Uzbek mining projects as of 2012 is planned to reach 800 million in 2013-2015.

According to the company's development programme till 2021, the main increase in natural gas production is expected to occur in Uzbekistan.

LUKOIL is currently working in the country to implement projects under the production sharing agreement (PSA) -- Kandym-Khauzak-Shady-Kungrad, to develop the fields of South-West Gissar and conducts exploration of the Uzbek part of the Aral Sea within the international consortium.

It was reported that the Kandym gas processing complex with a capacity of eight billion cubic meters a year will be built to process gas produced within the Kandym-Khauzak-Shady-Kungrad and Gissar projects.

The LUKOIL Uzbekistan Operating Company (subsidiary of LUKOIL Overseas Holding representing the interests of LUKOIL in the international oil and gas sphere) is the operator of the projects in Uzbekistan.

At present gas production in the country hit more than 15 billion cubic meters.

LUKOIL is one of the largest foreign investors in Uzbekistan. At present, the company's total investment volume to the economy has hit 2.5 billion since 2004, including over 120 million -- in exploration.

"Lukoil" plans to produce 18 billion cubic meters of gas by 2017 within the first two projects at PSA terms. The volume of investments is planned to be brought to 8 billion.   


Navoi Mining and Metallurgy Combine (NGMK) will start to re-equip its mining and transport, as well as railway complex in the beginning of 2013.

RIA Novosti reported quoting source in the combine that the government entrusted to develop feasibility study on modernization programme by the end of 2012 and start to buy equipment in the beginning of next year.

Within the programme, it is planned to purchase 15 hydraulic excavators, 50 large-capacity cargoes, and update mining and railway equipment.

The modernization of equipment is connected with growth of mining works at Muruntau field in Central Kyzylkum and Zarminat and Gujumsay fields in Samarkand.

The estimated programme of the programme is US$130 million. NGMK will issue US$70 million and Fund for Reconstruction and Development of Uzbekistan will issue loan for US$60 million.

Modernization of automobile and railway transport will allow NGMK to increase ore supplies to processing capacities by 35% by 2020 in comparison with 2011 to 150 million tonnes a year.   


Uzbekugol (Uzbek Coal) open joint stock company will direct US$90 million to modernization of mining and transportation till the end of 2014, RIA Novosti reported quoting the source in the Uzbek Government.

The report said that the government entrusted the company by the end of 2012 to prepare feasibility study of the project on modernization of technologic fleet till 2014.

Within the project, it is planned to replace 70 units of equipment - trucks, mobile crushing facility, combines, loading machines and conveyors.

The project will be financed due to own resources of Uzbekugol, Fund for Reconstruction and Development of Uzbekistan, and loans of Uzbek banks.

Uzbekistan plans to modernize coal industry and expand coal production from 2.28 million tonnes expected in 2012 to 17.2 million tonnes in 2021.

Mining of brown coal will grow by 3.9 times to 16.3 million tonnes by 2021, while mining of coal - 9 times to 900,000 tonnes. At the same time, share of coal in fuel-energy balance of Uzbekistan will jump from 3.9% to 12%.

Uzbekugol produces 98% of coal in Uzbekistan. It mines coal from Angren brown coal mine in Tashkent region with explored reserves of coal for 1.9 billion tonnes. Sharguncoal mines Baisun and Shargun coal fields in Surkhandarya regions. Its reserves make up 45.8 million tonnes of coal.

Watch a video, courtesy of the Uzbek Embassy in Washington DC, about development of small and medium size companies and private entrepreneurship in Uzbekistan. 
Please contact Laziz Kudratov, Counselor on Trade and Economic Affairs of the Uzbek Embassy, for questions about doing business in Uzbekistan. 

Laziz Kudratov

Trade & Economic Affairs

Embassy of the Republic of Uzbekistan

to the United States of America

phone: +1 (202) 530 7299

mobile: +1 (202) 679 9945

fax: +1 (202) 293 6804

The American-Uzbekistan
Chamber of Commerce
1300 I Street, N.W.,
Suite 720W
Washington, DC 20005
phone: 202.509.3744
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