Focused on Development of Eco-friendly Technologies

Bukhara Oil Refinery in Uzbekistan

SK Engineering & Construction (E&C) announced on July 7 that it has signed an engineering service agreement with Uzbekistan's state-run oil and gas corporation Uzbekneftegaz (UNG) for a US$600 million project to modernize Bukhara Oil Refinery. The contract value is US$7.2 million.

SK E&C and UNG signed a collaboration agreement on the project at a preliminary event for a summit in Tashkent, Uzbekistan, in April 2019. The two companies finalized the deal through economic cooperation talks in Seoul on July 6. Due to the COVID-19 spread, the two companies signed the contract via a non-face-to-face method.

Established in 1992, UNG is a state-run oil and gas corporation with 120,000 employees and is Uzbekistan's largest company in the oil and gas-related sectors. It is currently operating two oil refineries (150,000 barrels a day) and plans to expand into the oil refinery and petrochemical businesses to upgrade Uzbekistan’s energy industry, which is currently promoted as a national project. It is showing great interest in benchmarking SK Group’s rapid growth in this sector.

UNG is modernizing the 50,000-barrel-a-day Bukhara Oil Refinery, which is located 437 kilometers southwest of Tashkent, the capital of Uzbekistan. SK E&C plans to improve its refinery facilities to process heavy oil into high value-added light petroleum products, and raise the quality of products such as gasoline and diesel to new eco-friendly standards (Euro V).

SK E&C is sharing with UNG its expertise in the entire project process from investment review to engineering, procurement and construction (EPC), operation, and maintenance. It is creating a new business model with its client.

SK E&C is expanding its portion of eco-friendly business in 2020 and focusing its capabilities on developing eco-friendly business models and technologies. Earlier in February, it signed a technology service agreement and memorandum of understanding with Indonesia's largest state-run construction company, WIKA, on an eco-friendly asphalt project. It is developing the required technologies and planning to build a commercialization plant.

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