Modernization of Ferghana Refinery LLC

As you know, the Ferghana Refinery is undergoing a large-scale modernization, renewal and reform of production. Ferghana Refinery LLC is the largest industrial enterprise in Central Asia. For more than 60 years, the company has been producing products necessary for the national economy.

To date, one of the main goals of the plant modernization project is to improve the quality of petroleum products produced at the plant to the level of international standards, including motor fuel to the level of Euro 5 class and lubricating oils to the level of API group II+/III, as well as to achieve a processing depth of at least 93%.

Basis for Project Implementation: The project is being implemented in accordance with the Resolution of the Cabinet of Ministers of the Republic of Uzbekistan No. 67 dated February 7, 2020, Resolution of the Cabinet of Ministers of the Republic of Uzbekistan No. 751 dated December 14, 2021, and the Resolutions of the President of the Republic of Uzbekistan No. PP-72 dated December 30, 2021, and dated July 13, 2023.

Project Location: Fergana Region, Fergana city, Sanoat Street, Building 240.

Project Objective: To develop the enterprise’s export potential by supplying the country’s domestic consumers with high-quality petroleum products, ensuring efficient utilization and modernization of production capacities, the implementation of the following investment projects is planned.

Project Capacity: The annual project capacity is 2 million tons of crude oil, which will allow the production of the following petroleum products:

• 560 thousand tons of EURO-5 AI-92 automotive gasoline;
• 198 thousand tons of Jet A-1 aviation kerosene, including 25 thousand tons of TS-1 aviation kerosene;
• 538 thousand tons of EURO-5 diesel fuel;
• 175 thousand tons of base and motor oils of API Group II+III;
• 290 thousand tons of construction and road bitumen;
• 64 thousand tons of liquefied gas;
• 25 thousand tons of other types of petroleum products;
• Increase in crude oil processing depth to at least 92%;
• Optimization of the water and steam supply system to reduce energy consumption;
• Reconstruction of existing units to ensure sustainable production of high-quality petroleum products;
• Improvement of the environmental conditions of production and the surrounding environment;
• Automation of the control and accounting system for raw materials, finished products, and energy resources.

Project Cost and Funding Sources: Total cost – $399.9 million, including own funds – $99.9 million, loans from international and domestic financial institutions amounting to $300 million, as well as long-term loans allocated by foreign banks and financial institutions for co-financing the investment project. On February 29, 2024, a working group commission arrived with the aim of launching a new steam boiler house. The working group provided necessary instructions and gave positive conclusions on the completed construction and installation works.

Implementation Timeline: 2020-2025, including:

• Hydrogen production unit – successfully commissioned in test mode on August 30, 2024;
• PSA unit – May 2025;
• Chemically purified water and steam production unit – April and July 2024;
• Water chemical purification unit and one medium-pressure boiler commissioned in April and July 2024;
• All (5 units) steam-producing boilers – April 2025;
• Hydrocracking unit – Q2 2026.

 

New Jobs Created: 194 new jobs created with efficient use of existing workplaces.

Availability of Pre-Project Documentation: The project's feasibility study was developed in accordance with the Resolution of the Cabinet of Ministers of the Republic of Uzbekistan No. 67 dated February 7, 2020, passed an expert review at the State Unitary Enterprise "Center for Comprehensive Expertise of Projects and Import Contracts" under the Ministry of Economic Development and Poverty Reduction of the Republic of Uzbekistan, and received a positive conclusion. The feasibility study of the project was approved by the Resolution of the Cabinet of Ministers of the Republic of Uzbekistan No. 751 dated December 14, 2021.

Construction and Installation Works: Construction and installation of new technological processes and development of working projects for the reconstruction of existing technological facilities, supply of equipment and materials, and execution of construction and installation works – 71% in total. Construction of administrative and utility buildings and structures – 100%. Construction of the hydrogen production unit – 100%. Construction of steam-producing boilers – 98.5%.

Design, Equipment Supply, and Construction: Within the project, design work has been completed by 75%, technological equipment supply – by 80%, and construction and installation work – by 58%.

Work Completed in 2024:

• 100% supply of equipment and inventory for the steam boiler house and chemically purified water unit, completion of construction and installation works, commissioning of the water chemical purification unit and one medium-pressure boiler in April and July 2024;
• Completion of construction and installation works on 32 out of 35 new storage tanks;
• Completion of the construction of the central operators' building;
• Completion of repair works on 15 existing storage tanks;
• 100% supply of equipment and inventory for hydrogen production and PSA units, intensive construction and installation works in progress, completion of construction works on the hydrogen production unit, loading of catalysts into the reactor, furnace, and adsorbers, completion of connection to the plant’s utility networks. On August 30, 2024, the hydrogen production unit was launched in test mode, and from September 2, high-purity hydrogen production (99.9%) was achieved;
• Reconstruction of equipment for the production of commercial oils, purchase of new packaging equipment for 20-liter and 200-liter containers, completion of installation work, and establishment of production;
• Industrial safety expertise conducted for 4 new units and all reconstructed technological units;
• Engagement of an independent technical consultant – completed, company KBR;
• 100% delivery of 249 units of new modern level and flow meters, 82 units installed in crude oil and petroleum product tanks and transport pipelines;
• Purchase of over 20 new laboratory equipment units;
• Acceleration of working project development – ongoing since May 2021;
• Material delivery to the construction site – established, most equipment delivered to construction sites;
• General construction works – ongoing;
• Installation and commissioning of solar panels with a capacity of 1.35 MW;
• Completion of construction and installation works and commissioning of a 12 km medium-pressure external gas pipeline network;
• Reconstruction of plant roads, paving of over 3 km of roads, and landscaping;
• Establishment of production of new, import-substituting Jet A-1 aviation kerosene, EURO-4,5 diesel fuel, and 7 types of modern motor oils of Group I.

Work Planned for 2025:

• Full commissioning of PSA units and steam production;
• Launch of a new flare system;
• Full commissioning of 35 new storage tanks, automation of crude oil and petroleum product accounting;
• Completion of construction of the central laboratory building and 100% purchase of laboratory equipment;
• Equipping the central operators' building with necessary equipment;
• 100% completion of working projects for reconstructed and new units, completion of reconstruction work on 5 units;
• Completion of construction and installation works on water blocks No. 1 and No. 1a;
• Completion of construction and installation works on substation No. 1 and the control building;
• 100% supply of hydrocracking unit equipment, 70% completion of construction and installation works.

According to the instructions of the President of the Republic of Uzbekistan on the final decision to phase out AI-80 gasoline from 2025, a project has been developed jointly with the Russian company LLC "Energy & Engineering" to reconstruct the L35-11/300 unit at the Fergana Oil Refinery for conversion to an isomerization mode, aiming to produce gasoline meeting EURO-4,5 standards. Construction and installation works have been completed on the unit. Currently, commissioning works are being carried out jointly with LLC "Energy & Engineering."

As of today, a total of $398.6 million has been attracted within the project implementation.