Uzbekistan: South Korean Firm Inks Energy Deal with Tashkent

The state-owned South Korean National Oil Corporation (KNOC) has signed a deal with its Uzbek counterpart, Uzbekneftegaz, to begin exploring and drilling for oil and gas deposits, local media have reported.

The agreement covers exploration in the Namangan-Tergachi and Chust-Pop regions in eastern Uzbekistan and cover an area of 4,800 square kilometers. Preliminary research suggests the sites may contain 10.5 million tons of natural gas and 9.2 million tons of oil, according to a November 10 report distributed by the Itar-Tass news agency.

"This is the first time a South Korean company has become the general contractor for developing prospective oil and gas deposits in Uzbekistan," the new agency report stated. Industrial production at the Namangan-Tergachi and Chust-Pop zones may begin as soon as 2011.

KNOC already operates in Uzbekistan as part of a consortium surveying for hydrocarbon deposits near the Aral Sea. As KNOC Aral Ltd., it owns a 10.2 percent share in the development along with Uzbekneftegas, Lukoil, China's CNPC and Malaysian Petronas. KNOC initially owned a 20 percent stake, but transferred just under half of its interest to Korean steel giant POSCO in 2007.