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CIS Market in Salicylic Acid and its Derivatives

Chemical Industry of Uzbekistan

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Nunquam petrorsum, semper ingrediendum

Review of the Global Polyimide Market

Interplastica 2014: Good Prospects

for Russia’s Plastics Industry

Uzbek Chemical Industry Russian Pigment ProducersEstonian Chemical Industry Belarusian Chemical Industry

Kazakh Chemical Industry

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03/2013 Chloromethanes in CIS: Production and MarketRussian and Ukrainian Market for Benzoic Acid and BenzoatesRevolution at the Global Helium Market on the AgendaCIS Production and Market of Talc Slip Additives for Production of WoodPlastic Composites

04/2013 International Conference ''Oil and Gas Chemistry 2013''Styrene Production and Market in Russia/CISRussian Phenol Production in 2012 Russian Market of Selenium in 2012Production and Market of Complexones in CIS

05/2013 Russian Epoxy Resins Production and MarketThe Russian Polypropylene Market: Waiting for Revolution Chinese Phenol and Acetone Market: Review and OutlooksRussia's Market for Fuel Additives

06/2013 Plastics Recycling: Profitable and VersatileProduction and Market of Propylene in Russia/CISUkrainian Manufacture of Nitrogen Fertilisers in April, 2013CIS Silicon Dioxide MarketHeading into H2: Key Russian Chemical Players Announced Q1, 2013 Results

07/2013 Overview of Russian Market for Unconventional Cable CompoundsRussian Tyres Market: Current State and OutlooksSodium Sulphate Production in Russia Ukrainian Output of Mineral Fertilisers in May, 2013Tracking Corrosion with Ultrasound

08/2013 Bioplastics: an Alternative with a Future?Russian Production of Ureafuran Resins Ukrainian Production of Basic Inorganics and Mineral Fertilisers in H1, 2013Review of the Russian Vulcanisation Accelerators Market Tall Oil Production and Market in Russia

09/2013 Plastics in ElectronicsProduction of Formalin in Russian FederationRussian Production of Benzene in 2011H1, 2013Production and Market for Soda Ash in CISRussian Market for Demulsifiers for Oil Extraction

10/2013 Trends in the Global and Russian PPS MarketProduction and Market for Urea in CISRussian Market for PVC ThermostabilisersKazakhstan Petrochemical Industry Waiting for Sweeping Changes

11/2013 Market for Aramid Fibres in CISEthylene Oxide Market in RussiaPhosphorus Market in the CISUkrainian Output of Basic Inorganics in September, 2013Kazakhstan Defines Top Priority Chemical Commodities for Future Production

1/2014 Review of Global Polyimide Market CIS Market in Salicylic Acid and its Derivatives nterplastica 2014 : Good Perspectives for Russia's Plastic IndustryChemical Industry of Uzbekistan

Polymers

A Review of the Global Polyimide Market

Interplastica 2014 : Solid Business and Good Prospects for Russia’s Plastics and Rubber Industry

Prices

Rubbers & tyres

Organics


Prices

Inorganics

Agrochemistry

Summing up Ukrainian Fertilisers Production in 2013: No Light at the End of the Tunnel

Prices

Specialty chemicals

Paints & coatings

Chemistry and business

A systemic analysis of an economic policy of regulating hydrocarbons ows worldwide under the conditions of the 'shale gas revolution'

EuroChem Reports IFRS Financial Information for 2013

Chemical equipment

Certicates for Industrial Equipment and Installations Needed to Access Market of Customs Union

Countries and regions

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Contents

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#12(84) December 2013

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Polymers

К 2013: Flagship Event in Plastics Industry

Polymers Production Goes Up in Russia

Prices

Rubbers & tyres

SIBUR Increases its Butyl Rubber Production Capacity in Togliatti

Ukrainian Tyres Production Up 36.4% in October, 2013

Prices

Organics

On the Way to MDI. Nitrobenzene market in Russia and the CIS

Acrylic Acid Complex Construction Starts in Bashkortostan

Russian Methanol Production in 2012-2013

Prices

Inorganics

Ukrainian Output of Basic Inorganics in October, 2013

Cherkasy Azot Upgrades Ammo-nia Shopoors

World-scale Copper Ore-Dressing Plant Commissioned in Russia

Prices

Agrochemistry

Phosphorite Meal Production in Russia

Stamicarbon Goes East

Ukrainian Production of Mineral Fertilisers in October, 2013

Sunkar to Build NP Fertiliser Plant in Kazakhstan

Prices

Specialty chemicals

Rostec, Rosneft and Pirelli to Develop New Materials for Tyres

Prices

Paints & coatings

Tambov-based Pigment Intro-duces New Products

Prices Pharmaceuticals

Rafarma Pharmaceuticals Announces Large Private Placement

Chemistry and energy

Chemical Aspects of Solar Energy: Polycrystalline Silicon Market in the CIS

TVEL to Construct Nuclear Chemical Fuel Plant in Ukraine

Chemistry and business

Uralchem Reports IFRS Financial Results for Q1-3, 2013

Rosneft Demonstrates Strong Financial Performance

SIBUR Reports Q1-3, 2013 IFRS Results

Chemical equipment

Uralmashplant — at the Cutting Edge of Russian Industry Modernisation

Countries and regions

Ukrainian Output of Chemical and Related Products in November, 2013

India Ready to Invest in Chemi-cal, Pharmaceutical Industries

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Polymers www.chemmarket. info

A Review of the Global Polyimide Market

Polyimides (PIs) is a group of high performance polymers with excellent thermal, mechanical, and physi-cal properties. Owing to their outstanding characteristics, they are useful over a wide range of applications including the production of printed circuit boards, fasteners, and chemically resistant products. Polyimides take an especial position in the development of innovative technologies, where light-weight materials with high strength, flexibility, inertness, and a broad range of working temperatures are required.

3№ 1(85) February 2013 Eurasian chemical market

Polymerswww.chemmarket. info

DuPont’s baby

The first information about the synthe-sis of aromatic polyimides dates back to 1908. A big contribution to the develop-ment and introduction of polyimides was made by DuPont, which brought to market Kapton H films, Vespel moulded parts, and Pyre-ML insulating varnish. To obtain its first Kapton polyimides, the company employed pyromellitic anhydride (PMDA) and 4,4’-oxydianiline (ODA). Figure 1 shows a diagram of the condensation of these chemical products.

The process developed by DuPont includes two stages: firstly, polyamic acid is synthesised and secondly, the acid undergoes imidization. Dianhydride and diamine are used as mother sub-stances (Table 1). The condensation is

Table 1. Basic dianhydrides and diamines used for polyimide production Dianhydride Diamine

Formula Abbreviation Name Formula Abbreviation Name

PMDA Pyromellitic anhydride pDA p-phenylenediamine

BPDA Diphenyl dianhydride mDA m-phenylenediamine

BTDA Benzophenone dianhydride DAB Benzidine

DSDADiphenyl sulfone

dianhydride DABP Diamine-benzophenone

ODPA Oxydiphthalic anhydride DDSDiaminodiphenyl

sulphone

HQDA Oxydiphthalic anhydride ODA Oxydianiline

BPADABisphenol-A-diphthalic

anhydride BisDA Bisphenol-A-diamine

Figure 1. Obtaining polyimide from PMDA and ODA



carried out at low and medium tem-peratures in a polar, aprotic solvent, for instance, in N,N-dimethylformamide, N,N-dimethylacetmide or in N-methyl- pyrrolidone.

The process involving the obtaining of the soluble prepolymer has been for more than fifty years the main technology of polyimide production. The point is that most polyimides are insoluble and high melting due to their flat aromatic and heteroatomic structure. Therefore, their processing into some articles can only be possible provided that they are solved in polyamic acid. The use of the solv-ing route allowed for commercial production of polyimides.

The intermediate polyamic acid is con-verted to polyimide by thermal or chemical imidization. Thermal imidization is con-ducted at 100–350 °C basically for manufac-turing PI films, while chemical imidization is used for producing moulded goods as well as films and fibres. At that point, aliphatic car-boxylic acid anhydride and tertiary amine are added to polyamic acid. The typical auxilliary chemical reagents for this process are acetic anhydride, pyridine and triethylamine. At the final stage of the chemical imidization, the polymer is shortly heated up to around 300 °C so as to reach a higher conversion degree and to remove the remains of the solvent. The chemical imidization excludes a counter

reaction, thus allowing for obtaining polyim-ides with higher and more stable mechanical properties (Table 2). However, due to the usage of additional reagents, the final product is more expensive. Leading global producers of polyimide films use namely this chemical process of imidization, whereas the Chinese producers - the thermal route. As a result, the products of the first have an integral proce-dural decomposition temperature of 200–240 °C and polyimides of the second – only about 130 °C.

Apart from the two-stage method there is also a one-stage route for producing polyimide used for polyimides soluble in organic solvents at a polymerisation tem-perature of (180–220 °C). Nitrobenzene, m-cresol, and high-boiling polar aprotonic amide solvents are used as solvents. The high temperature solving polymerisation occurred in the presence of such catalysts as quinoline, tertiary amines and carboxy-lates of alkali metals or zinc. This method is especially efficient for polymerising dianhydrides and diamines with low reac-tivity and enables one to produce high crystallinity polyimides.

Using bis-ester anhydride as a dianhydride component, polyesterimides - amorphous thermoplastic polymers — are produced, which can further be processed by injection moulding methods. Shrinking polyimide

resins are obtained by adding low molecular maleimide, acetylene, benzene dicarbinol (benzocyclobutene) groups. These resins find application in the impregnation of textile fibres and in composites production.

A polymer basis of electronics

To synthesise polyimides, a broad set of monomers are employed as well as various methods. Therefore, properties of polymers may vary within a wide range.

Polyimidies possess exclusively high ther-mal resistance. They begin decomposing only at temperatures higher than 450 °C. At the same time, polyimides are resistant to oxida-tion, moisture, acids, alkalies, solutions of salts, organic solvents and specialised liquids even at increased temperatures. However, polyimides that contain fragments of PMDA and monoaromatic amines, e.g. pDA, have lower resistance to hydrolysis.

Good dielectric properties of polyim-ides determine their wide application in the electronic industry as dielectrics, flex-ible substrates and wire insulation. Fluoride-containing polyimides possess the best dielectric properties.

Outstanding properties are conditioned by a structure of a polymer chain and intermo-lecular interactions. Molecules of polyimide have rigid aromatic chains. There are two types of interactions between polyimide chains: firstly, between aromatic rings of fragments of dianhydride and diamine form-ing a complex with charge transfer and sec-ondly, between dipoles of carbonyl groups of the dianhydride fragment (in this case the polymer is nonpolar as a whole).

Most polyimides are produced in the form of films. Polyimide films have high mechani-cal properties. Their relative elongation at break amounts to 30–120%, tensile strength – 170–270 MPа, and modulus of elasticity – no more than 3 GPa. Breakdown voltage of polyimide film with a thickness of 1mcm is no more than 200 V. Besides, these films possess high radiation resistance. Polyimide

Table 2. Comparison of chemical and thermal polyimide films

PropertyPolyimide film

Chemical Thermal

Physical properties (strength and relative elongation)

IsotropicAnisotropic (difference —

up to 40%)

Shrinkage (at 200 °C during two hours)

Less than 0,05% Up to 1%

Dielectric breakdown, кW/mm Around 7 Around 5,5

Moisture absorption (during 24 hours)

Less than 2,8% Around 4%

Width, мм (max.) 1570 1000

Length, м (max.) 4000 1500

Source: Saint-Gobain HPM



films are coated with acrylic and organosili-con compounds for manufacturing self-adhe-sive tapes. Also, an adhesive layer is applied to them in order to glue copper foil (on one or two sides). Such films are further supplied to manufacturers of printed circuit boards for producing flexible circuits and cable connections. When an extremely thin layer of copper (less than 12 mcm) is required or the presence of adhesives is undesirable, the copper is applied to polyimide film either by evaporation deposition or by coating copper foil with polyimide varnish followed by its hardening. The films with reflective coatings are obtained by adding organic silver salts, e.g., complex acetates, to a polyamic acid solution. While imidizing, it occurs silver reduction. Silver further migrates to the sur-face of the film forming a reflective coating.

For many years, poyimides have been used in electrical engineering and the aerospace industry for insulating special purpose wires. In the aerospace industry, they are used as protective coating for solar cells and other important equipment.

Also, microporous membranes, thin wall tubes, fibres, foam materials are made from them. Polyimide tubes are manufactured by layer-by-layer application to the surface of a metal mandrel, which is subsequently retracted.

Such tubes find aplication gas chromotog-raphy as chromatographic columns as well as in medicine in the capacity of catheters. Polyimide fibres production is notable for a number of technical complexities. Therefore, not many companies make these products. Having excellent properties including a high stretch degree, PI fibres, nevertheless, cannot compete with aramid and other hi-tech fibres due to high manufacturing costs. These fibres are mainly used for producing industrial filter bags and protective clothing.

PI membranes are widely used for sepa-rating gases. «Pure» polyimide membranes have, as a rule, low gas permeability. For this reason, they are modified with various alkyl and fluoroalkyl substitutes.

Films

Currently, the production of flexible printed circuits accounts for 70% of PI con-sumption worldwide. Due to specific require-ments of the final market and their properties, polyimides are mostly produced in the form of films. At present, global polyimide film capacity totals 13,000 tonnes. Top three pro-ducers have at their disposal about two thirds of world’s capacity including Kaneka – 24%, DuPont-Toray – 22% and SKC Kolon PI – 21% (Figure 2).

Kaneka produces polyimide films under the brand Apical at three production plants in Japan, the USA, and Malaysia. The company has been present in the market since 1984, when it put into operation its first manufac-turing line for Apical films in Shiga prefec-ture (Japan). Today it operates seven lines with a total capacity of 2,400 tpy. In North America, Kaneka began manufacturing poly-imide films at a 200 tpy production line in the industrial park of Bayport (TX, USA) within the frames of a JV with Allied in 1990. Kaneka Texas Corporation, a daughter com-pany of Kaneka, operates the line. Last year the company completed the construction of its third plant in Gebeng (Pakhang, Malaysia)

operated by the company’s fully-owned subsidiary — Kaneka Apical Malaysia. The launch of the Malaysian facility increased Kaneka’s total capacity for polyimide films by 600 tonnes, to 3,200 tpy. By 2016, Kaneka will invest USD 100m in further capacity expansion.

US-based DuPont became a pioneer in the polyimide market setting industry standards for a long period of time. It started commercial production of Kapton films in 1966. Since 1985, DuPont-Toray, a JV between DuPont and Toray, has been responsible for polyimide business. The JV is completely owned by the American chemical giant. DuPont-Toray expanded the plant in Tokai City (Aichi prefecture) by 720 tpy in 2007 and that in Circleville (OH, USA) by 400 tpy in late 2012. As a result, the company boosted its total capac-ity up to 2,920 tonnes.

Space flight of polyimidesOwing to their properties, polyimides

are ideal materials for creating different

elements of spacecraft. Foam polyimides

found application in the Space Shuttle

programme as heat insulation and sound

insulation. They were used for protecting

propelling and steering control engines

of Mars rovers. Moreover, flexible printed

circuits and plate heaters in the Mars rov-

ers were made of polyimide films. In May

2010, the JAXA (Japan Aerospace Explo-

ration Agency) launched IKAROS — the

world’s first spacecraft propelled by solar

power sails made on the basis of square

polyimide film with a 7.5 mcm thickness

and a 200 m2 total area.

Figure 2. Breakdown of global polyimide film capacity by company

as of early 2014



SKC Kolon PI is a JV established in 2008 on the basis of polyimide assets of Korea-based companies SK Chemical и Kolon Industries. SK Chemical was the first in Korea to manufacture polyimides. In 2004, it launched a 40 tpy pilot production line at its manufacturing site in Suvon. The com-mercial production of polyimide films began at a 300 tpy unit in Chinchkhon. In 2008, the second 600 tpy line became operational in Chinchkhon. Kolon Industries started poly-imide production in 2005. By the moment of the merger, it operates two production lines in Kumi with a total capacity of 600 tpy. In 2012, SKC Kolon PI almost doubled its pro-

duction capacity, from 1,500 tonnes to 2,700 tonnes.

China is home to one fourth of world’s pol-yimide film capacity. There are ten producers with 3,000 tpy overall capacity in the country (Table 3). Moreover, the moment when China will become the main player on the polyimide market is not too far away. In late 2012, Amer International Group and Genhwa proceeded to building a large-scale polyimide complex in Yingkou (Liaoning province). The first stage of the project envisages the construc-tion of a 11,000 polyimide monomer unit, a 30,000 tpy polyimide and multilayer coextru-sion film plant, and a 30,000 tpy composites

unit. At the second stage, there will come on stream a 40,000 tpy polyimide monomer and fine organic chemicals plant, a 35,000 tpy polyimide and multilayer coextrusion film unit, and 5,000 tpy polyimide fibres produc-tion. The second stage will be completed in 2017.

Other polyimide manufacturers account for 9% or 1,000 tpy of total global capacity. This group includes Saint-Gobain Performance Plastics producing Norton films in Xinzhu (Taiwan); IST Corporation, which puchased polyimide businesses Pyre-ML® from DuPont (Parlin, NJ) and Skybond® from Monsanto (Indian Ochard, Springfield, MA); Japanese companies Ube Industries (Ube, Yamaguchi prefecture and Sakai, Osaka prefecture) and Mitsubishi Gas Chemical (Hiratsuka, Kanagawa) producing Upilex and Neopulim films respectively.

Fibres

In the early 80s of the 20th century, Lenzing, a leading producer of viscose fibre, began developing a new kind of fibre for protective clothing. Polyimide was selected as a polymer base. The company obtained a licence for a polycondensation process from Upjohn (Dow

Table 3. Basic polyimide producers in China

Company Location Capacity, tpy

CEN Electronic Material Co. Ltd Ningpo, Zhejiang province 240

Changshu Zhongxun Space Flight Insulating Material Co. Ltd Changshu, Jiangsu province 160

Hipolyking Polyimide Materials Co. Ltd Jilin City, Jilin province 300

Jiangsu Yabao Insulation Material Inc. Yangzhou, Jiangsu province 300

Jiangyin Tianhua Technology Co. Ltd Jiangyin, Jiangsu province 100

Liyang Huajing Electronic Material Co. Ltd Liang, Jiangsu province 230

New Century (Tianjin) Polyimide Films Insulating Materials Co. Ltd

Tianjin 200

Shanghai Research Institute of Synthetic Resins Shanghai N/A

Shenzhen Ruihuatai Film Technology Shenzhen, Guandong province 350

Tecnidd Enterprises Co. Ltd Hangzhou, Zhejiang province 1000

Tianjin Jiayi Insulation Material Co. Ltd Tianjin 100

Wuxi Di’Ao Insulating Material Co. Ltd Wuxi, Jiangsu province 60

Wuxi Goto Polymer Materials Co. Ltd Wuxi, Jiangsu province N/A

Flexible circuits — the main application of polyimide films



Chemical), whereas a thread drawing technol-ogy was developed by Lenzing on its own. As a result, new polyimide product P84® was launched onto the market.

In 1996, Lenzing AG sold its business to Inspec Fibres GmbH (Evonik Fibres GmbH, part of Evonik). Today, Inspec Fibres is vir-tually the only large producer of polyimide fibres. In small quantities, however, polyim-ide fibres are manufactured by Hipolyking Polyimide Materials (Yilun fibre, China), and Russia-based Lirsot Ltd (Arimid, Pion, and Tvim brands).

Because of increased demand for its prod-ucts, Inspec Fibres expanded its capacity by 35% in 2006 and by 40%, to 1,400 tpy in 2009. Except for the fibres, the company pro-duces powdered polyimides for manufacturing moulded goods and actively develop a poly-imide film production technology. Polyimide fibres are predominantly used in the produc-tion of high temperature filter systems for metallurgical works, cement plants, and other industrial facilities. These fibres have irregular cross-sectional shapes consequently possess-ing twice as much surface area as compared to traditional fibres with round or elliptical cross-sections. Therefore, polyimide fibres display the best filtering capacity. This advantage is complemented with high thermal and chemical resistance over a wide рН range. These fibres are used as an additive enhancing filtering capacity and increasing service life of filter fab-ric in industrial filters both on their own or in combination with various polyester fibres and glass fibres.

The second most significant application of polyimide fibres is the manufacture of protective clothing for racing drivers, fire brigades and military units. It is to be noted that usually polyimide fibres are not used in a pure form but are mixed with aramid and fire-resistant viscose fibres.

Foam polyimides

Polyimide foam was first synthesised in the 1970s by Evonik Foams for NASA’s

space programmes. The latter required non-combustible, light-weight foam material for heat and sound insulation of Space Shuttles. Later polyimide foam was utilised in space-crafts of other countries, in the International Space Station, Mars rovers, and cryogenic vessels. Polyimide foam remains its elasticity even at extremely low temperatures, which is of paramount importance for operations on the surface of Mars.

In addition to spacecraft, polyimide foam is used in military and civil shipbuilding and the aircraft industry. Owing to this foam, the weight of some U.S. Navy cruisers was decreased by 50 tonnes, and that of Boeing 747 — by 160 kg. Reducing weight even by several dozen kilograms of such massive and heavy objects as airplanes seem to be insignificant at first glance. However, this allows for transporting more cargo and substantially improves fuel economy, which is especially important tak-ing into account a long service period. Due to high prices, polyimides find application only in demanding environments. The main producer is Evonic Foams manufacturing polyimide foam under the trade mark Solimide at its plant in Magnolia (AK, USA). Its product range includes four polyimide grades:

– TA-301 (for industrial applications including insulation of rail cars, ships, and mining equipment;

– AC-550 and AC-530 (for aircraft and spacecraft industries and cryogenic materials production);

– HT-340 (for using in heat resistant mate-rials including insulation of pipes, air ducts, furnaces, and water heaters;

Apart from Evonik Foams, polyimide foam is manufactured by DuPont (Vespel), Ube Industries (Upilex Foam) и IST Corporation (Skybond).

Resins and other products

Polyimide resins are made in small vol-umes because of processing complexities. Powdered polyimide is one of the main forms of polyimide products. Ube Industries,

Inspec Fibres, Qinyang Tianyi Chemical, Hipolyking Polyimide Materials, and Shuangma New Materials Tech Polyimide are producers of polyimide powder.

In addition, polyimides are processed into round bars, slabs, sheets, tubes, and other ready-to-use, customizsed products. We should mention the following companies in this market niche: DuPont-Toray, IST Corporation, Saint-Gobain Performance Plastics, Hipolyking Polyimide Materials, and Shanghai Research Institute of Synthetic Resins. Polyimides varnishes – solvents of polyamic acid - are also available on the mar-ket. They are used for producing composites and adhesives. The most popular and wide-spread brands among them are Pyralin (HD MicroSystems), U-Varnish (Ube Industries), Pyre-ML and Skybond (IST Corporation).

Prospects

Polyimides are quite widely used products owing to their outstanding properties. They can meet strictest requirements of customers. Flexible circuits are the biggest and most fast-growing application field of polyimide films. According to Kaneka, annual growth rates in this market make up 20-30%. Demand for special purpose products made of poly-imide films including bar code labels, voice coils, helically coiled tubes, gaskets, and diaphragms, thermal blankets, insulation of particle accelerators, conveyor belts, sensors, etc., increases 10% yearly. Polyimide con-sumption in the production of self-adhesive tapes grow 5% and in mechanical engineer-ing, and the cable and automotive industries — by 2% per year. SMP Corporation (a pro-ducer of polyimide films, in particular, SKC Kolon PI films) forecasts that the capacity of the global polyimide film market will go up from 7,000 tpy in 2010 to 10,000 tpy in 2015, with the biggest growth rates in electronics engineering and display production. In geo-graphical terms, China and Korea will be the most rapid-growing polyimide markets expanding by more than 15% annually.



The CIS market for plastic and rubber products stands for solid business and posi-tive prospects. Despite the dampening effect of political vagaries and the current weak-ness of the rouble on the demand for plastic and rubber products, the country still has a significant need for investment. Production capacities are being modernised and expanded, particularly in the packaging and medical technology segment. The consumer goods and automotive segments are growing steadily, and the infrastructure of the largest European country with a population of 143m is facing major challenges. In this situation, innovative solutions for all areas of the plas-tics and rubber processing industry are very much in demand, particularly because issues such as energy efficiency and recycling are becoming increasingly important.

Accordingly, exhibitors at Interplastica 2014 gave a predominantly positive feedback on the four-day international trade fair for

plastics and rubber. They reported a keen interest among specialist visitors, promis-ing customer contacts and several signed contracts. Between 28 and 31 January 2014, 20,000 visitors from all members of the CIS attended Interplastica and the packaging fair Upakovka/Upak Italia, both of which took place at the same time in Moscow. This result ties in with the one achieved by both trade fairs in the previous year.

Erhard Wienkamp, Division Director of Messe Düsseldorf, was delighted with this posi-tive result: “Thanks to its representative inter-national portfolio, Interplastica is perceived and valued as an outstanding platform for techno-logical innovation in Russia. This positive feed-back and the fact that there was even a slight increase in the demand for exhibition space - only a few weeks after the flagship fair K 2013 - underlines the importance of this event. The companies know how important their market presence is. Even in turbulent

times, they rely on Interplastica to present their innovations to customers from the CIS market, to maintain their customer contacts and to initiate new relations. Introducing a clearer structure to the fair, the new hall distribution elicited predominantly positive feedback from visitors and exhibitors.“

Interplastica 2014: Solid Business and Good Prospects for Russia’s Plastics and Rubber Industry

Victor Nemera, Atlant CJSC,

Baranovichi/Belarus: ‘We participate

regularly in Interplastica, know what

we want and usually get it. It satis-

fies our expectations. It’s important

to note that this year there are more

professional visitors than in previous

years. It’s obviously very good.’

Maxim Grishin, Country Repre-

sentative A/O Bayer Polycarbonates,

Moscow/Russia: ‘At Interplastica

2014 we basically met with our old,

established partners. This exhibition

is well known in the plastic and rub-

ber industry and every year we meet

with lots of customers and get in

contact with new customers.’

Alexei Stolyarov, Chief Expert, De-

partment of Advertising, Exhibition

Activities and Branding, LLC Sibur/

Sibur Holding OJSJ, Moscow/Russia:

‘We have long and fruitful coopera-

tion and ties with Messe Düsseldorf

Moscow. We are always satisfied by

the attentive attitude and profes-

sionalism of the organisers’ team..

Next year we plan to expand our

stand area and to occupy the central

part of the first pavilion. We had ac-

tive and large work with our clients

during Interplastica and it’s time to

expand and reveal.’



Organised by Messe Düsseldorf and its subsidiary Messe Düsseldorf Moskau Ltd, the 17th Interplastica was again hosted at Moscow’s trade fair grounds of Krasnya Presnya. A total of 687 exhibitors from 28 countries presented their products and ser-vices on 13,500 sq.m net exhibition area, the “Forum” as well as exhibition halls 1 and 8 and, for the first time, hall 3 were fully booked, the latter by a cluster of extrusion and injection moulding machinery manufac-turers. Official national participations came from China, Germany, France, Italy, Austria and Portugal. The largest contingencies of exhibitors came from Russia, Germany and China.

Germany remains to be number one among the most important suppliers to the Russian plastics and rubber processing industry,

exporting a total of 32.2 % to this segment, followed by Italy (15.5 %) and China (13.9 %). In the first eleven months of 2013, German exports in this segment amounted to EUR 204 million, up 10,2 % on the result posted for the same period during the previ-ous year. Between 2011 and 2012, global

exports from plastics and rubber machinery manufacturers to Russia increased by 7.5%, corresponding to an overall value of about EUR 640m.

For Bernd Nötel from the German Association for Plastics and Rubber Machinery within the VDMA (Verband

Sebastian Schneider, Key-Account-

Manager PM Rezyklate, DKR –Deutsche

Gesellschaft für Kreislaufwirtschaft und

Rohstoffe mbH, Cologne/Germany: ‘As

we are new to the Russian market, it

presents some challenges, one of which

is the language barrier. Also, recycled

products do not have a good reputation

in Russia, mainly because very few such

products are available in high quality.

But appreciation for regrinds is growing

in the CIS states along with the inter-

est in high-quality recycled products. At

Interplastica, we had some interesting

new contacts, and the prospects for

long-term business cooperations seem

positive. However, we are well aware

that this market requires a lot of pa-

tience.’

Dragan Visekruna, Director of the

Plastics Sales Units in Central and East-

ern Europe, Greece and Turkey, Dow

Europe GmbH, Moscow/Russia: ‘Dow

took part with an own booth in Inter-

plastica 2014 for the first time ever. We

consider that the exhibition is very suc-

cessful. The customers appreciated our

desire to participate in the exhibition

highly. Our approach is to work in co-

operation with distributors. In the previ-

ous years we joined the booths of our

partners and this year we invited them

to work on our own booth.’

Robert F. Binder, Area Sales Manager,

EREMA, Ansfelden/Austria : ‘Our equip-

ment has met with a keen interest. As

a supplier of recycling systems for all

thermoplastic materials, we have been

active in Russia for sixteen years. So far,

our core business focused on in-house

recycling of waste scrap directly at the

processing company’s site. Recently

however, the post-consumer market

seems to have become more active as

the population demands recycling regu-

lations. This development could open

up a major market for us! We are op-

timistic about the future development

of our business relations with the CIS

states, because we have consolidated

our position and won the trust of our

customers in that market – not only be-

cause of our training programmes and

cooperation with research institutes but

also because of our tenacity.’

Rauf Rustamov, Sales & Marketing

Director, Mikrosan, Gebze-Kocaeli/

Turkey: ‘We have been exporting

pipe and profile extrusion machinery

and pelletisers to Russia since 1991.

With more than 1,000 machines in-

stalled in that country, we have be-

come established as a major player in

this segment. We expect to continue

our business in Russia successfully.

The Russian economy will continue

to grow, the Olympic Games and

the World Cup 2018 will trigger fur-

ther growth. There is a lot to do and

enough money for investment, par-

ticularly in window construction, in the

infrastructure of this vast country and

in centralised heating. These projects

are supported by state funding. We

participate in Interplastica because

we want to promote our good repu-

tation, maintain our existing customer

contacts and make new ones.’



Deutscher Maschinen- und Anlagenbau - German Engineering Federation), the Russian market remains promising, despite the dampening effect of political vagaries and the current weakness of the rouble on the demand for plastic and rubber machin-ery: “Negotiations drag on, some projects are postponed. In other areas however, there is still a great willingness to invest, contracts that were prepared at K 2013 in Düsseldorf for example, are now being signed. Business is going strong in the

injection moulding and thermoforming segments, and rubber processing machines are in high demand. Thanks to state fund-ing, investments into plastic pipe produc-tion and into the production of insulation material are rising. The emergence of recycling as an important issue in Russia is rated as a positive development. So far, this development is still in its infancy, but there is a growing awareness that even countries with an abundance of natural resources must economise.“

Dr. Rüdiger Baunemann, Director General PlasticsEurope Deutschland e.V., recognises a lot of potential in the raw material segment, both for polymer producers as well as for suppliers of additives such as stabilisers and flame retardants. At Interplastica’s “Meeting Point Raw Materials”, Dr. Baunemann’s presentations on resource and energy effi-ciency as a driving force for innovation and sustainability attracted a lot of attention and met with keen interest. For the second time at Interplastica, open seminars for exhibitors on new developments in raw material produc-tion and application were again conducted in cooperation with the Russian plastics portal Plastinfo.ru.

The exhibitors were impressed with the high level of professionalism among Interplastica’s visitors, who appeared to be well prepared and approached the exhibitors with practical inquiries. In turn, visitors were delighted with the wide range of international exhibits presented at Interplastica.

The next Interplastica will take place in Moscow from 27 until 30 January, 2015, as usual in tandem with Upakovka/Upak Italia.

Ulrich Reifenhäuser, Managing Di-

rector Reifenhäuser GmbH & Co. KG,

Troisdorf/Germany : ‘’The CIS market

continues to have a lot of potential for

the plastics processing industry. The ex-

hibition was livelier and the visitors even

more professional than expected. But

the currency problem is a real dampen-

er, particularly as the Russian mentality

seems to have a bias towards pessimism

when confronted with such problems.

Therefore, some projects will likely be

delayed. ‘’

Antonio Cappadono, General Direc-

tor Transtechnika-Vostok – Representa-

tion of Arburg, Moscow/Russia : ‘’While

the Russian market is characterised by

steady ups and downs, it offers excel-

lent long-term prospects. We have been

active in this market for a long time and

have become well established – reli-

ability and comprehensive service are

the key to success! For me, the current

weakness of the rouble does not con-

stitute a major problem, but an oppor-

tunity: the export of finished products

such as packaging has become more

expensive, hence domestic products will

be in demand. Arburg customers from

the packaging segment are enjoying full

order books. The Russian automotive

and medical technology segments are

also experiencing an upturn, and they

are now investing in modern, efficient

machinery. ‘’

Dr. Semen Chlesberg, Senior Sales

Manager, Zeppelin Systems, Frie-

drichshafen/Germany : ‘’Moving into

the CIS market requires money and

patience. In the long-term however,

this commitment will bear fruit. Twelve

years ago, Zeppelin started its activi-

ties in that region, initially with one

sales agency. Only recently, we set

up our own subsidiary there, so as to

provide a localised services and spare

parts supply and support for our sales

team. As a leading global plant engi-

neering company for the handling of

high-quality bulk materials and liquids

we work in a wide variety of industry

sectors, i.e. polymer producers and

processors, the rubber and tire indus-

try and plastic cable sheathing. We

also operate a separate division with a

special focus on the food segment. We

provide our customers, mainly major

corporations, with a complete service

package from the delivery of complete

lines right through to training. This

will consolidate our long-term success

even if this market is prone to ups and

downs.’’


Polymers Priceswww.chemmarket. info

Prices for polymers and polymer compounds of Russian, Uzbek, Turkmenistan, Belarus, Ukraine manufacturers in 1Q, 2014

Product Company City Country NotesPrice per

tonnes, ex. VAT

Oligoester acrylates MGF-9 Armoplast PJSCSeverodonetsk

(Luhansk region)Ukraine

For reinforced plastics, coatings, building

materials, electrical insulating compounds,

lacquers, enamels, adhesives

83333 UAH

Oligoester acrylates TGM-3 Armoplast PJSCSeverodonetsk

(Luhansk region)Ukraine For production of resins 85000 UAH

Phenol-formaldehyde resin solution in ethyl alcohol (lacquer bakelite) LBS-20, 71-78%

Armoplast PJSCSeverodonetsk


For production of reinforced plastic

22000 UAH

Polyamide PA 6 210/310 Anid LtdYekaterinburg

(Sverdlovsk region)Russia

For manufacturing of technical products used

in mechanical engineering101695 RUR


(Sverdlovsk region)Russia 101695 RUR

Polyamide PA 6 66-3 Anid LtdYekaterinburg

(Sverdlovsk region)Russia Moulding grade 355932 RUR

Polyamide PA 6 66-4 Anid LtdYekaterinburg




Polyamide PA 610L Anid LtdYekaterinburg

(Sverdlovsk region)Russia Moulding grade

432203-457627 RUR

Polyester mixed EDA-50Kazan Synthetic

Rubber Plant JSCKazan (Republic of

Tatarstan)Russia

Up to 100 kg / For non-crystallizable urethane

rubber and polyurethane foam for bottom of shoes

78814 RUR

Polyester mixed PVKazan Synthetic


Tatarstan)Russia

Up to 100 kg / For manufacturing inking rollers, polyurethane

compositions

78814 RUR

Polyester P 9AKazan Synthetic


Tatarstan)Russia

Up to 100 kg / To obtain optically sensitive

polymers as components of adhesive compositions

78814 RUR

Polyester P-9-14Kazan Synthetic


Tatarstan)Russia

Up to 100 kg / manufacturing products

for special purposes78814 RUR

Polyester resin PN-1KT-A, unsaturated, thixotropic, pre-accelerated, 30-33% styrene

Zhylevsky Plastics Plant JSC

Sitne-Schelkanovo (Moscow region)

Russia

Barrel 240 kg / For production of thick-

walled, large-sized and complex-shaped goods /

For RTM-technologies

101900 RUR

Polyester resin PN-1KT-M, unsaturated, thixotropic, pre-accelerated, 30-33% styrene



Russia

Barrel 240 kg / Binding agent for fibreglass

products / For use in mechanised processes

101900 RUR


Polymers Prices www.chemmarket. info


tonnes, ex. VAT

Polyester resin PN-1KT-NR, unsaturated, thixotropic, pre-accelerated, 31-34% styrene



Russia

Barrel 240 kg / For production of thick-

walled,large-sized and complex-shaped goods

101900 RUR

Polyester resin PN-54KTA, unsaturated, thixotropic, pre-accelerated, 36-42% styrene



RussiaBarrel 240 kg /For

fibreglass products and RTM-technology

118500 RUR

Polyester resin PN-609-21M, unsaturated

Granat Synthetic Material Plant CJSC

St. Petersburg RussiaManufacturing fiberglass

products186440 RUR

Polyester resin PN-82K, unsaturated



RussiaBarrel 240 kg / For

polymer concrete and artificial marble

109600 RUR

Polyester resin PN-85, unsaturated



Russia

Barrel 240 kg / For water- and acid-resistant

polymer concrete and sanitary ware products,

and artificial marble

99000 RUR

Polyester resin unsaturated PN-1



For production of glass fiber, polymer concrete

and artificial marble30000 UAH

Polyester resin unsaturated PN-15, chemically resistant



For manufacturing of chemically resistant

pipes, containers, boat hulls, boats, yachts, pressed materials,

varnishes, adhesives, putties, coatings

55000 UAH

Polyester resin unsaturated PN-1КТ



Russia Barrel 240 kg 100750 RUR

Polyester resin unsaturated PN-609-21М



Binder for fiberglass and as impregnating and casting resins

inautomotive, electrical industry

55000 UAH

Polyesters PEFDKazan Synthetic


Tatarstan)Russia

Up to 100 kg / to manufacture of polyurethane compositions

78814 RUR

Polyether Laprol 373 Khimprom Ltd Kemerovo Russia

EXW / Cisterns 31-36 tonnes, metal barrels / For producing rigid polyurethane foams

90000 RUR

Polyether Laprol 5003-2-B10

Khimprom Ltd Kemerovo RussiaFor producing resilient

polyurethane foams90000 RUR

Polyether Laprol 502 Khimprom Ltd Kemerovo Russia

EXW / Cisterns 31-36 tonnes, metal barrels / For producing rigid

polyurethane foams and brake fluids

90000 RUR

Polyether Laprol 503B Khimprom Ltd Kemerovo Russia

EXW / Cisterns 31-36 tonnes, metal barrels / For producing rigid polyurethane foams

90000 RUR




tonnes, ex. VAT

Polyether Laprol 6003-DE Khimprom Ltd Kemerovo RussiaEXW / Cisterns 31-36

tonnes, metal barrels / For producing oil demulsifiers

90000 RUR

Polyether Laprol ES-564 Khimprom Ltd Kemerovo Russia

EXW / Cisterns 31-36 tonnes, metal barrels /

For producing filling, rigid polyurethane foams

90000 RUR

Polyethylene LDPE 153-01К, top grade

Tomskneftekhim Ltd Tomsk Russia Cable grade 58051 RUR

Polyethylene LDPE 153-10К, top grade

Tomskneftekhim Ltd Tomsk Russia Cable grade 57627 RUR

Polyethylene LDPE 15303-003, top grade

Tomskneftekhim Ltd Tomsk Russia Film grade 56780 RUR


Tomskneftekhim Ltd Tomsk Russia Moulding grade 55932 RUR





Polyethylene LDPE 15803-020, 2 grade







Tomskneftekhim Ltd Tomsk Russia 47881 RUR

Polyethylene LDPE 18103-035


Polyethylene LDPE B-Y456Shurtan Gaz Chemical

Complex Unitary Branch Establishment

Shurtan (Qashqadaryo

province)Uzbekistan Blow-moulding grade 3696003 UZS

Polyethylene LDPE B-Y460Shurtan Gaz Chemical



province)Uzbekistan Blow-moulding grade 4776594 UZS

Polyethylene LDPE F-Y346Shurtan Gaz Chemical



province)Uzbekistan Film grade 4026118 UZS

Polyethylene LDPE I-0760Shurtan Gaz Chemical



province)Uzbekistan Moulding grade 3080195 UZS

Polyethylene LDPE I-1561Shurtan Gaz Chemical



province)Uzbekistan Moulding grade 1400 USD

Polyethylene LDPE P-Y342Shurtan Gaz Chemical



province)Uzbekistan Pipe grade 4629629 UZS

Polyethylene LDPE R-0448Shurtan Gaz Chemical



province)Uzbekistan Rotational grade 3186762 UZS




tonnes, ex. VAT

Polyethylene LDPE О-Y750Shurtan Gaz Chemical


Shurtan (Qashqadaryo province)

Uzbekistan Film grade 3035072 UZS

Polyethylene LDPE Р-Y456Shurtan Gaz Chemical



Uzbekistan Pipe grade 3902756 UZS

Polyethylene LDPE, grade A, off grade

Tomskneftekhim Ltd Tomsk RussiaFor manufacturing of technical products, packaging materials

48051 RUR

Polyethylene LDPE, grade B, off grade

Tomskneftekhim Ltd Tomsk RussiaFor manufacturing of technical products, packaging materials

48051 RUR

Polyethylene LLDPE F-0120Shurtan Gaz Chemical



Uzbekistan Film grade 1500 USD

Polyethylene LLDPE F-0220 SShurtan Gaz Chemical



Uzbekistan Film grade 1450 USD

Polyethylene LLDPE F-0320Shurtan Gaz Chemical



Uzbekistan Film grade 5174166 UZS

Polyethylene LLDPE F-Y 957Shurtan Gaz Chemical



Uzbekistan 3859671 UZS

Polyethylene LLDPE I-0525Shurtan Gaz Chemical



Uzbekistan Moulding grade 1400 USD

Polyethylene LLDPE I-1625Shurtan Gaz Chemical



Uzbekistan Moulding grade 3406728 UZS

Polyethylene MDPE R-0333Shurtan Gaz Chemical



Uzbekistan Rotational grade 3589187 UZS

Polyethylene MDPE R-0338Shurtan Gaz Chemical



Uzbekistan Rotational grade 3073018 UZS

Polyethylene MDPE WC-Y734

Shurtan Gaz Chemical Complex Unitary

Branch Establishment


Uzbekistan Cable grade 3156433 UZS

Polyethylene NMPE-2 Tomskneftekhim Ltd Tomsk RussiaUsed inrubber industry, in construction, for greases

and mastics26949 RUR

Polyethylene terephthalate TverPET, granulated

SIBUR-PETF JSC Tver Russia Packaging for food 55085 RUR

Polypropylene Tolen PP H031 BF /3


Polypropylene Tolen PP H270 FF /3

Tomskneftekhim Ltd Tomsk RussiaManufacture of

nonwovens54237 RUR

Polypropylene Tolen PP H450 GP/2


Polypropylene Tolen PP R003 EX/1





tonnes, ex. VAT

Polypropylene Tolen PP H007 EX/1

Tomskneftekhim Ltd Tomsk Russia Pipe grade 56356 RUR

Polypropylene Tolen PP H022 CM /1

Tomskneftekhim Ltd Tomsk RussiaProduction of caps for

PET bottles58051 RUR

Polypropylene Tolen PP H030 GP

Poliom Ltd, Omsk Polypropylene Plant

Company Omsk Russia General purpose 53390 RUR


Tomskneftekhim Ltd Tomsk Russia General purpose 53390 RUR









Polypropylene Tolen PP H032 TF/1

Tomskneftekhim Ltd Tomsk Russia Thermoforming 54237 RUR

Polypropylene Tolen PP H032 TF/2

Tomskneftekhim Ltd Tomsk Russia Thermoforming 54237 RUR











Polypropylene Tolen PP H085 CF/1


Polypropylene Tolen PP H085 CF/2


Polypropylene Tolen PP H120 GP








Polypropylene Tolen PP H252 IM /2




nonwovens57203 RUR



nonwovens56356 RUR



nonwovens58051 RUR




tonnes, ex. VAT

Polypropylene Tolen PP H352 IM/2








Polypropylene Tolen PP R003 EX


Polypropylene Tolen PP R003 EX/1


Polypropylene TPP D 30 STurkmenbashi Complex of Oil

Refineries

Turkmenbashi (Balkan province)

Turkmenistan Extrusion grade 1350 USD

Polypropylene ТРР F 79 FBTurkmenbashi Complex of Oil

Refineries


Turkmenistan

For production nonwovens for hygiene

and medical spheres

3278 TMT

Polystyrene expandable EPS ALPHAPOR 101

SIBUR-Khimprom CJSC

Perm Russia

Manufacturing foam plastic for noise and heat insulation and drainage

board

61864 RUR


SIBUR-Khimprom CJSC

Perm Russia

Manufacturing foam plastic for noise and heat insulation and drainage

board

70339 RUR


SIBUR-Khimprom CJSC

Perm RussiaManufacturing foam for

thermal insulation of external walls

72034 RUR


SIBUR-Khimprom CJSC

Perm Russia

Manufacturing foam for thermal insulation of external walls under

load

72034 RUR


SIBUR-Khimprom CJSC

Perm RussiaFor manufacturing of

blocks with waterproof protective coating

70339 RUR


SIBUR-Khimprom CJSC

Perm Russia 38983 RUR

Polystyrene expandable EPS-FВ-НМ 15, 20, 1 grade, unsaturated

Angarsk polymer plant JSC

Angarsk (Irkutsk region)

Russia

For manufacturing insulating blocks,

packaging, disposable tableware / 3, 5, 20

tonnes of containers, covered rail-cars

56949 RUR

Polystyrene expandable EPS-FВ-НМ-Р 0,2-1,25, 1 grade, saturated



Russia




61017 RUR




tonnes, ex. VAT

Polystyrene expandable EPS-FВ-НМ-Р 0,2-1,25, 2 grade



Russia




61017 RUR




Russia




52542 RUR




Russia




52542 RUR




Russia




57627 RUR




Russia




57627 RUR

Polystyrene expandable EPS-С, grade 1

Plastic JSC Uzlovaya (Tula region) Russia Self-extinguishing 66949 RUR









Polystyrene expandable EPS-С, grade 5m




Polyvinyl alcohol, 10% solution

Lakokraska JSC Lida (Grodno region) Belarus Without cost of packaging 6820000 BYR

Polyvinylchloride PVC-C 5868PZh

Kaustik JSC Volgograd Russia Film grade 40000 RUR

Polyvinylchloride PVC-C 6149U

Kaustik JSC Volgograd RussiaCable, pipe grade / Molding, extrusion

methods40000 RUR

Polyvinylchloride PVC-C 6358М

Kaustik JSC Volgograd Russia General purpose 40000 RUR




tonnes, ex. VAT

Polyvinylchloride PVC-C 6669ZhS

Kaustik JSC Volgograd Russia Profile windows 40000 RUR


Kaustik JSC Volgograd Russia Profile windows 40000 RUR


Kaustik JSC Volgograd Russia Cable, pipe, film grade 50000 RUR

Polyvinylchloride PVC-C 8059U

Kaustik JSC Volgograd RussiaExtrusion, calendering and

moulding 50000-52000

RUR

Urea-formaldehyde concentrate UFC-85

UCC Shchekinoazot Schekino (Tula region) Russia15000-18000

RUR

Urea-formaldehyde concentrate UFC-85, 58% formaldehyde, 23% carbamide

Metafrax JSCGubaha (Perm

territory)Russia

Up to one cistern 65 tonnes / For plywood,

chipboard15000 RUR

Urea-formaldehyde resin KF-NU

Lakokraska JSC Lida (Grodno region) Belarus Without cost of packaging12458000

BYR

Urea-formaldehyde resin KF-Zh grade L,F,М

Lakokraska JSC Lida (Grodno region) Belarus With cost of packaging14385000

BYR

Urea-formaldehyde resin KF-Zh, 67-69% dry residue

Navoiyazot JSC Navoiy Uzbekistan 980 USD

Urea-formaldehyde resin KF-Zh, 67% dry residue

Lakokraska JSC Lida (Grodno region) Belarus Without cost of packaging 12458000 BYR

Urea-formaldehyde resin KFBZh, 65–69% dry residue



RussiaEXW / Tank trucks, drums

/ For plywood29330 RUR

Urea-formaldehyde resin PКМ



RussiaEXW / Barrels / For making

paper- resin films21500 RUR

Urea-formaldehyde resin КF-BМ-ТК, 65% dry residue



RussiaEXW / Tank trucks, drums

/ For cladding furniture made of chipboard

29330 RUR

Urea-formaldehyde resin КF-МТ-15

Lesohimik JSCBorisov (Minsk

region)Belarus 4955000 BYR

Urea-formaldehyde resin КF-МТ-15

Navoiyazot JSC Navoiy Uzbekistan 550-600 USD

Urea-formaldehyde resin КF-МТ-15, 64-68% dry residue



Russia Barrels / For chipboard 26160 RUR

Urea-formaldehyde resin КF-МТ-20PS



RussiaFor production of heat and

sound insulating foam26560 RUR

Urea-formaldehyde resin КFZh



Russia EXW / Tankers, barrels 29330 RUR

Urea-formaldehyde resin КS-11, 60-64% dry residue


Vinyl ester resin RP-14S, unsaturated, 38-45% styrene



Russia

Barrel 240 kg / Binding agent for water and chemically resistant

polymer concrete and fibreglass products, anti-

corrosion coatings

258700 RUR

1 EUR = 45,0559-49,5839 RUR Official exchange rate, according to the Central Bank of Russia during 1Q 2014

1 EUR = 3000,05-3053,73 UZS Official exchange rate, according to the Central Bank of the Republic of Uzbekistan during 1Q 2014

1 EUR = 3,8982-3,9159 ТМТ Official exchange rate, according to the Central Bank of Turkmenistanduring 1Q 2014

1 EUR = 10,8496-13,6372 UAH Official exchange rate, according to the National Bank of Ukraine during 1Q 2014

1 EUR = 12650-13400 BYR Official exchange rate, according to the National Bank of the Republic of Belarus during 1Q 2014


Rubbers and tyres Priceswww.chemmarket. info

Prices for some synthetic rubbers and latexes in Q1, 2014

Product Manufacturer City Country NotesPrice per 1

tonne, ex.VAT

Butadiene rubber SKD-ND, grade B

Voronezhsintezkauchuk JSC Voronezh Russia EXW 66949 RUR

Butadiene rubber SKD, grade B Voronezhsintezkauchuk JSC Voronezh Russia EXW 69492 RUR

Butyl rubber BК-1675N Togliattikauchuk LtdTogliatti (Samara

region)Russia EXW 101695 RUR

Butyl rubber BК-1675М Togliattikauchuk LtdTogliatti (Samara


Isoprene rubber SKI-3 Togliattikauchuk LtdTogliatti (Samara


Latex butadiene BSМ-65, grade B


Latex butadiene SКD-1S Voronezhsintezkauchuk JSC Voronezh Russia EXW 101780 RUR

Latex styrene-butadiene BS-50


Latex styrene-butadiene BS-65, grade А


Latex styrene-butadiene BS-85


Latex styrene-butadiene BSК-1


Latex styrene-butadiene BSК-2


Latex styrene-butadiene BSК-70/2


Latex styrene-butadiene SKS-30UК


Latex styrene-butadiene SKS-50GPS


Latex styrene-butadiene SKS-50КGP


Latex styrene-butadiene SKS-65GP


Latex styrene-butadiene SKS-65GP (B)


Rubber fluorosiloxane SKTFKazan Synthetic Rubber

Plant JSCKazan Russia

254237-847458 RUR

Silicone rubber SКТKazan Synthetic Rubber


254237-847458 RUR

Silicone rubber SКТEKazan Synthetic Rubber


For manufacturing mechanical rubber goods

preserving dielectric properties and elastic at

temperatures ranging from -70 to +200 C

254237-847458 RUR

Silicone rubber SКТNKazan Synthetic Rubber


For manufacture of compounds, sealants

254237-847458 RUR

Silicone rubber SКТNFKazan Synthetic Rubber


For the manufacture of compounds, sealants

254237-847458 RUR


Rubbers and tyres Prices www.chemmarket. info


tonne, ex.VAT

Silicone rubber SКТVKazan Synthetic Rubber


Intended for manufacture of rubber goods,

preserving elastic and dielectric properties in the temperature range of from

-50 to +250 °C

254237-847458 RUR

Sodium-butadiene rubber BNKS-18AMN

Krasnoyarsk Synthetic Rubber Plant JSC

Krasnoyarsk Russia EXW 83475 RUR

Sodium-butadiene rubber BNKS-18АN






Sodium-butadiene rubber BNKS-28AMNP















Sodium-butadiene rubber PBNK-33 (PVC)



Sodium-butadiene rubber SKN-26PVC-30



Sodium-butadiene rubber SКN-18SNТ


Sodium-butadiene rubber SКN-26SNТ


Styrene-butadiene rubber BSК-1502

Togliattikauchuk LtdTogliatti (Samara


Styrene-butadiene rubber DSSК-2560-М27, grade А


Styrene-butadiene rubber SKS-30 ARKM-15, grade В, SBR-1706 HI-AR


Styrene-butadiene rubber SKS-30 ARKM-27, grade A


Styrene-butadiene rubber SKS-30 ARKM-27, grade В


Styrene-butadiene rubber SKS-30 АRК, grade В, С


Styrene-butadiene rubber SKS-30 АRКМ-15, grade В, SBR-1706 TDAE


Styrene-butadiene rubber SКМS-30АRКМ-15

Togliattikauchuk LtdTogliatti (Samara


Styrene-butadiene thermoplastic elastomer DST-30-01, group 1, granules

Voronezhsintezkauchuk JSC Voronezh Russia Big bags 103390 RUR


Rubbers and tyres Priceswww.chemmarket. info


tonne, ex.VAT

Styrene-butadiene thermoplastic elastomer DST-30-01, group 1, powder

Voronezhsintezkauchuk JSC Voronezh Russia 107627 RUR

Styrene-butadiene thermoplastic elastomer DST-30-01, group 2, granules


Styrene-butadiene thermoplastic elastomer DST-30R-01, group 1, granules


Styrene-butadiene thermoplastic elastomer DST-30R-01, group 3, granules


Styrene-butadiene thermoplastic elastomer DST-30R-01, group 3, powder

Voronezhsintezkauchuk JSC Voronezh Russia 107627 RUR

Styrene-butadiene thermoplastic elastomer SBS R30-00А, granules


Styrene-butadiene thermoplastic elastomer SBS R30-00А, powder

Voronezhsintezkauchuk JSC Voronezh Russia Bags 107627 RUR

Thermoplastic dynamic Kvartopren, grade А (50,60, 70, 80,90), black

Kvart CJSC Kazan Russia Moulding 98000 RUR

Thermoplastic dynamic Kvartopren, grade А (50,60, 70, 80,90), black

Kvart CJSC Kazan Russia Extrusion 117000 RUR

Thermoplastic dynamic Kvartopren, grade А (90) E, gray

Kvart CJSC Kazan Russia Extrusion 117000 RUR

Thermoplastic dynamic Kvartopren, grade А (90), gray

Kvart CJSC Kazan Russia Moulding 98000 RUR

Urethane rubber (polyurethane elastomer) SKU-8А

Kazan Synthetic Rubber Plant JSC

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1 EUR = 45.0559-49.5839 RUR Official exchange rate, according to the Central Bank of Russia during 1Q 2014


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Salicylic acid (C6H4 (OH) COOH, ortho-hydroxybenzoic acid, 2-hydroxybenzoic acid, phenol acid) - white needle-shaped crystals with a bitterish taste, soluble in hot water, freely soluble in ethanol, diethyl ether and other polar organic solvents.

Leaves and flowers of some plants are natural sources of salicylic acid. It is known that ancient doctors used an infusion of the willow bark as antipyretic and analgesic medicines. In 1829, Henri Leroux, a French pharmacist, isolated physiologically active

glycoside salicin (from Latin salix - ‘wil-low’) from a willow bark extract. In 1838, Raffaele Piria, an Italian chemist, hydrolysed salicin with further oxidation. This is how salicylic acid was obtained. It was found that the acid had been previously obtained from flowers of meadowsweet, or Spiraea (spirea ulmaria) by a German chemist Carl Löwig, who called it spiraea acid and later the sub-stance became known as “salicylic acid”. The analysis showed that it was a derivative of phenol. Subsequently, a German chemist

Adolph Hermann Kolbe proposed a method of synthesising salicylic acid from phenol in 1860, which has been used to the present day.

Salicylic acid acts as an antiseptic. The acid is used as a keratolytic agent when present in high concentrations, and as a keratoplastic substance when present in low concentrations.

The keratolytic agent breaks down the outer layer of skin (keratin). A keratoplastic effect is when the drug does not generate a quick destruction and sloughing, thereby loosening keratin.


Salicylic acid belongs to aromatic hydroxy acids. Its anti-inflammatory properties, as a component of the bark of the willow tree, have been known for more than 2,500 years. Currently, more than half of the produced salicylic acid is used for pharmaceutical manufacture. For example, one of its derivatives is acetylsalicylic acid or aspirin - one of the most important drug of the twentieth century.


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Salicylic acid is used to treat various skin diseases, in particular, hyperkeratosis and excessive sweating. Taken orally, salicylic acid may cause severe irritation of the mucous membrane lining of the stomach. That is why a sodium salt of salicylic acid instead of the pure acid is often used. Salicylic acid is well absorbed from the gastrointestinal tract exert-ing antipyretic, analgesic and anti-inflamma-tory actions. The drug is rapidly excreted from the body.

Salicylic acid and salicylates are low-toxic and fairly well tolerated. Since salicylates are used in large doses for rheumatism treat-ment they can cause poisoning, which easily ceases as soon as one stops taking the drugs.

Until the 50s of the 20th century, salicylic acid was one of the most popular food pre-servatives. It was used for preserving egg melange, fish marinades, salted and pick-led cucumbers as well as olives and fruit. Salicylic acid is no longer used as a food preservative. Food applications of the acid are banned in America, Europe and Russia. However, salicylic acid with a concentration of up to 0.5% can be used for preserving cos-metic products. The acid with a concentration of up to 10% is used for keratosis (dandruff) treatment. The manufacture of azo dyes and odoriferous compounds (salicylic acid esters) is one of its applications as well.

Salicylic acid is capable of forming deriva-tives in each functional group. The most important of them are methyl salicylate and phenyl salicylate (esters of the carboxyl group) and acetylsalicylic acid (esters of the hydroxyl group). P-aminosalicylic acid and salicylamide are ne more significant deriva-tives of salicylic acid.

Acetylsalicylic acid (2-acetoxybenzoic acid; aspirin) is one of the most widely used drugs in the world. The pure substance is a white crystalline powder, almost odourless. The odour of acetic acid indicates that the substance started to hydrolyse in the air. Acetylsalicylic acid is sparingly soluble in water, soluble in ether and chloroform, and freely soluble in 96% ethanol.

An ester formed by acetic and salicylic acids or acetylsalicylic acid was first synthe-sised by Charles Gerhardt, a French chemist, in 1853. Soon, it became known as “aspirin”, from the name of meadowsweet (spirea ulmaria). This was the first synthetic drug in the history of medicine. In 1874, aspirin was applied to treat acute articular rheumatism. In 1899, aspirin was patented by Bayer and has been produced on an industrial scale since that time. For this reason, pharmaceutical companies in most countries has no right to apply the trademark “aspirin” to their prod-ucts and use basically the chemical name “acetylsalicylic acid”. Bayer has been own-ing the exclusive right to the brand aspirin in Russia since 1992. However, the term “aspi-rin” became a common word in the former Soviet Union.

John Vane was awarded the Nobel Prize for his discovery of how acetylsalicylic acid produces pain-relief and anti-inflammatory effects in 1982. He found out that aspirin blocked the synthesis of hormone-like sub-stances - prostaglandins - which are intensely formed by microbial intoxication causing an inflammatory reaction. Besides antipyretic and analgesic actions aspirin prevents the formation of blood clots and also has a vas-orelaxant action. At the same time, it irritates the mucous membrane of the gastrointestinal tract, and its overdose can cause bleeding.

Sodium salicylate (sodium 2-hydroxyben-zoate) is a sodium salt of salicylic acid. It is a white crystalline powder or small, odourless flakes with a sweet and salty taste. Sodium salicylate is easily soluble in water (1:1) and alcohol (1:6). Sodium salicylate has analge-sic, antipyretic and anti-inflammatory effects. It is used in medicine as antirheumatic and antigout agents as well as for the treatment of febrile diseases and migraine.

Para-aminosalicylic acid (PAS, 2-oxy-4-aminobenzoic acid) has been used to treat tuberculosis (TB) in the form of sodium or calcium salts since the 40s of the 20th century. PAS is an antagonist of p-amino benzoic acid needed for normal activity of

microorganisms. However, due to relatively low efficiency, PAS finds application only in case of intolerance to other anti-TB drugs or mycobacterial drug resistance. The drug has a bacteriostatic action only against tubercle bacillus. It is not an antifebrile medicine, although it relates to derivatives of salicylic acid.

Some derivatives of para-aminosalicylic acid, for example, its phenyl ester or para-benzoylaminosalicylic acid, have the same therapeutic activity as PAS proper.

Calcium benzoyl-p-aminosalicylate gives significantly fewer side effects when taken orally than PAS, and is used instead of the latter.

Methyl salicylate (salicylic acid methyl ester) is a colorless or yellowish liquid with a strong, aromatic odour. It is slightly soluble in water, and is miscible with alco-hol and ester in any proportions. Its density is 1,176-1,184 g/cm3. Methyl salicylate is one of the well-known aromatic substances. It was first isolated as the main ingredient of some natural essential oils (wintergreen and cherry birch oils). As the component of these oils, one began to widely use it in medicine. Methyl salicylate is also an ingre-dient of some ointments, balms and liniments often used in combination with chloroform, turpentine and fatty oils. Pharmaceuticals on the basis of methyl salicylate are meant only for external use as antiinflammatory and analgesic agents to treat neuralgia, migraine and rheumatism.

Phenyl salicylate (salol) is a white, crys-talline powder or small colourless crystals with a faint odour. It is virtually insoluble in water but soluble in alcohol (1:10) and alka-line solution, easily soluble in chloroform, and extremely easily soluble in esters. Phenyl salicylate was first synthesised by Wilhelm Marceli Nencki in 1886. He aspired to find a drug that preserving antiseptic properties of phenol would not cause irritation like sali-cylic acid. For this purpose, he blocked the carboxyl group of salicylic acid and obtained its ester with phenol.



This principle of using substances with an irritating action in the form of their esters became known as the “salol nencki princi-ple”. It was further used for synthesising a lot of medicines.

Hydrolysing in the alkaline environment of the gastrointestinal tract, phenyl salicylate releases salicylic acid and phenol - denaturing protein molecules. Salol does not decompose in the acidic environment of the stomach and does not irritate gastric mucosa as well as oral and esophageal mucosae.

Phenol, which forms in the small bowel, suppresses pathogenic intestinal microflora, and sodium salt of salicylic acid has anti-inflammatory and antipyretic actions. Partly excreting from the body by the kidneys, both compounds disinfect the urinary tract. Phenyl salicylate is far less active in comparison with modern antimicrobials, but it is low toxic provoking no dysbacteriosis and other complications. It is often used in outpatient practice. Phenyl salicylate is often used for coating tableted drug dosage forms, when it is necessary for them to pass through the stomach unchanged and to release the active pharmaceutical ingredient substances in the intestine.

Benzyl salicylate (salicylic acid benzyl ester) is a liquid crystallising at 18 °C. The boiling point of the liquid is 208°C and den-sity is 1,785-1,180 g/cm3. Salicylic acid ben-zyl ester is odorless and is used in perfumery as a preservative and a solvent of aromatic substances in perfume compositions.

The technique of producing benzyl salicy-late is based on the transesterification of methyl ester of salicylic acid by benzyl alco-hol in the presence of sodium salt of salicylic acid methyl ester. The transesterification is

conducted at underpressure with simultane-ous distilling disengaged methyl alcohol. The yield of benzyl salicylate is about 70% of the theoretical one calculated in terms methyl salicylate. Benzyl salicylate can be also obtained through the interaction between salicylates and benzyl chloride under heating. The reaction noticeably accelerates in the presence of small amount of diethylamine. The yield in this case is about 85% of the theoretically possible.

Saligenin (salicyl alcohol) is another deriv-ative of salicylic acid to be mentioned here. It occurs in compound with glucose as glyco-side salicin in roots and bark of different spe-cies of willow and some other plants. For the first time it was synthesised exactly from this glycoside. Saligenin is a solid substance, eas-ily soluble in alcohol, ester and in hot water. In case of cooling or evaporating, it occurs precipitation of saligenin from the solution in the form of white leaves with pearly lus-ter. Saligenin has a pharmacological effect similar to that of salicylic acid. Although this medication apparently does not cause side effects attributable to salicylic acid, in medical practice, it is hardly used, partly due to high cost, partly due to its significantly weaker effect compared to salicylic acid.

Salicylamide (salicylic acid amide, sala-mide) is a medicine as well. The medical application of salicylamide is the same as that of acetylsalicylic acid. It is mainly used as an analgesic and an antipyretic. Salamide is more stable compared to acetylsalicylic acid. While acetylsalicylic acid is easily hydrolysed in the human body with releasing salicylic acid, salicylamide hardly undergoes hydrolysis and is excreted from the body in an unchangeable state in significant volumes.

In some cases, salicylamide is better tolerated than other salicylates rarely causing some side effects.

Thiosalicylic acid is used as an anthel-mintic agent. It possesses bactericidal and fungicidal properties.

A lot of esters of salicylic acid are used in perfumery as perfume compounds and fixing agents. Ethyl salicylate (salethyl) has the same though much weaker odour as methyl salicylate. Isobutyl salicylate has floral fragrance reminding blooming clover. Ethyl salicylate is produced by the method described for methyl salicylate being used in perfumery as a substitution for the latter. Isopropyl and isoamyl esters of salicylic acid are liquids with the fragrance of orchids. A technology for isopropyl ether production is similar to that of methyl salicylate. Isoamyl salicylate is not found in natural essential oils. It is obtained by heating isoamyl alcohol with salicylic acid in the presence of con-centrated sulfuric acid. Allyl salicylate with a specific fruity floral odour, phenylethyl salicylate with a rose fragrance transforming into a heliotropin odour and isobutyl salicy-late with a floral odour of blooming clover are also applied.

Preparation

Currently the Kolbe-Schmitt method is used for salicylic acid synthesis (Figure 1). Sodium phenoxide is obtained via a reaction between phenol and a solution of sodium hydroxide. Then sodium phenoxide is dried and saturated with carbon dioxide under pres-sure and heated up to 125 °C. The resulted substance is dissolved in water and the solu-tion is acidified, to form salicylic acid.

Salicylic acid is a feedstock for the pro-duction of sodium salicylate, acetylsalicylic acid, methyl salicylate and phenyl salicylate. Methyl salicylate, in its turn, is a raw material for the synthesis of salicylamide. Moreover, methyl salicylate can be prepared from wastes of acetylsalicylic acid manufacture. Thus, there are strong interdependent relationships

Figure 1. Preparation of salicylic acid



between these chemical substances, and the advantages of integrated manufacture of salicylates at a single production complex are quite obvious. This allows solving the prob-lems of recycling and regeneration of several waste products, in particular, mother liquors, which contain acetyloxide and acetic acid as well as unreacted salicylic acid. Sodium salicylate is prepared by a reaction between equimolar amounts of purified salicylic acid (by sublimation) and sodium bicarbonate in ethanol (Figure 2).

Acetylsalicylic acid is manufactured by acetylation of technical salicylic acid and acetyloxide in the presence of chlorobenzene or chlorobenzene and acetic acid with utilis-ing recycled mother liquors; Figure 3).

The process route starts with loading chlorobenzene or recycled mother liquor, salicylic acid or “distillation residues” from mother liquors taken from the manufacture of the pharmaceutical grade product. It is followed by mixing and heating up to 34-36 °C. Then acetylating is carried out by adding acetyl oxide at temperatures of up to 78-82 °C during two hours. The obtained product is crystallised by cooling down to 15-20 °C followed by centrifuging the crude prod-uct and washing off by cold water and by isopropyl alcohol (IPA). The mother liquor containing chlorobenzene, acetic acid, acetyl oxide, acetylsalicylic acid (up to 15-20%), salicylic acid (up to 1% ), water (up to 1.5%) and resins (up to 4-5%) is returned to the acetylation stage (up to 10-15 times). After that the mother liquor is removed from the cycle and supplied to a wastes treatment unit or sent for regeneration. The flushing water is discharged into sewage facilities and the flushing isopropyl alcohol is sent for alcohol regeneration.

The product of pharmaceutical grade is prepared by recrystallisation from 40-60%

isopropyl alcohol with coal treatment. Coal is filtered and disposed or incinerated. The product is crystallised, centrifuged and washed off with cold water and IPA. The flushing water is discharged, and the mother liquor and flushing IPA are sent for aqueous IPA regeneration by distillation. The distil-lation residue of the wet salicylic acid (after isopropyl distillation) is dried down to a residual moisture content of max. 0.3% and then returned for acetylation. The washed pharma grade product is dried. The yield of the product is 90% in terms of salicylic acid. There is also a method of acetylation of wet “distillation residues” (containing 10-20% water ) by existing technologies at 55-60 °C in the presence of pyridine. The resulting active complex - acetic anhydride pyridin - accelerates the process of acetylation by four times. That is why the water present in the substance has no time to hydrolyse acetic anhydride (the latter was an obstacle for using wet “distillation residues” due to increased consumption of acetic anhydride).

There is also an old method of prepara-tion of acetylsalicylic acid by acetylisation of salicylic acid with acetic anhydride and its compounds with acetic acid using recy-cled mother liquors at 65-70 °C. The yield of the product in this case is 80-82%. The

technique is characterised by by-products formation, a complex process of acetous mother liquor utilisation and high con-sumption of acetic anhydride. However, the significant advantage of this method is the absence of problems related to the use of large amounts of an organic solvent - chlorobenzene.

Methyl salicylate (salicylic acid methyl ester) is prepared by esterification of sali-cylic acid with methanol in the presence of concentrated sulphuric acid (a catalyst and a “dehydrating” agent), i.e., virtually with methyl sulphuric acid (Figure 4).

According to the applied method, a prepared reactor is loaded with methanol, and sulphuric acid is gradually added at a maximum temperature of 30 °C followed by a hold up period of 30 minutes at 25-30 °C (the temperature is maintained by cooling with water through the reactor jacket). The resulting solution of methyl-sulphuric acid in methanol, is fed into an esterifier with loaded technical salicylic acid at an initial temperature of 70 °C followed by heating up to 70-74 °C till salicylic acid is dissolved and the substance is dilluted. After that the sub-stance is cooled down till its sedimentation and the lower layer of aqueous sulhuric acid is separated.

Figure 2. Sodium salicylate production process

Figure 3. Acetylsalicylic acid production process

Figure 4. Methyl salicylate production process



The resulted commercial methyl salicylate is washed with hot water (70-80 °C) till the aqueous layer has a 2.5-3pH level. The sul-phuric acid residue is neutralised by washing with a 10% sodium carbonate solution at 40 °C till 7-7.5pH followed by one more wash-ing with hot water (70-80 °C). As a result of the purification of the technical product by high-vacuum fractional distillation, the yield amounts to 87% in terms of salicylic acid. In case of utilising recycled salicylic acid, the yield is 86.5-86.8% of the theoretical one. Salicylamide is prepared by a reaction of amidation of methyl salicylate with 22-25%

aqueous ammonia in a leakproof reactor (Figure 5).

The flow chart includes stages of crude salicylamide and pharmacopeia salicylamide production. At first, aqueous ammonia and methyl salicylate are loaded into a prepared leak proof reactor, in which amidation occurs at temperatures of 40-47 °C during six hours. Then aqueous methanol with ammonia are distilled under vacuum. Distillation residues of salicylamide ammonium salt are dissolved in water and clarified with a solution of sodium dithionite (Na2S2O4) at 60-65 °C. Later the product is acidified at 60-65 °C with a 10% sulfuric acid solution to 3-4pH. The resulted salicylamide is crystallised at 15-20 °C, centrifuged and washed off with cold water. The yield of the crude product is 87-92% in terms of methyl salicylate.

Crude salicylamide is purified by its recrys-tallisation from distilled water with clarify-ing by coal and sodium dithionite at pH=5 (salicylamide – an amphoteric compound; at pH <3, salicylamide starts to melt partially due to protonation of the amide group). After sedimentation, the mother liquor is sucked out with vacuum and the residue is filtered by centrifuging. The product is washed off with cold distilled water. The mother liquors and the washing waters are used 3-4 times instead of water for dissolving during the recrystallisa-tion of the following batches, and then they are removed from the cycle and discharged. The yield of of the pharmaceutical grade product reaches 82-86% in terms of methyl salicylate.

Global market

According to Transparency Market Research, the capacity of the global salicylic acid market in 2012 totalled 95,000 tonnes with the pharmaceutical sector accounting

for 51.3% of thios amount or 48,700 tonnes (Figure 6). The sector of skin care products consumed 24,200 tonnes or 25.5% followed by shampoos and hair care products 14,300 tonnes (15,1%).

Global output is expected to rise 6.4% on average between 2013 and 2019. North America is the biggest consumer of sali-cylic acid having a 35% share globally. Nevertheless, the Asia-Pacific region will soon display higher growth rates. Salicylic acid is more and more widely used in cos-metics, in particular, hair care products. This niche will be possibly the main growth driver of the entire salicylic acid market. Aspirin demand will still go up exerting a paramount influence upon salicylic acid production. Governmental health protection initiatives aimed at wider use of aspirin by elderly per-sons to prevent cardiovascular deseases make a significant contribution to this process. On the other hand, growing consumer concerns over aspirin side affects will to some extent hinder the development of the salicylic acid market at the cost of aspirin.

CIS market

At present, salicylic acid is not synthesised in the former Soviet states. This also pertains to its most important derivative — acetylsalicylic acid — despite stable demand. At the same time, numerous pharma companies in Russia, Ukraine and Belarus use foreign acetylsalicylic acid for their own manufacturing of medicines under various trade marks. The companies that used to produce aspirin in large volumes removed from operation their manufacturing facilities long time ago. In particular, aspirin production at Organica OJSC (Novokuznetsk, Kemerovo region) launched as far as 1971 is no longer operational. Earlier before, there

Figure 5. Salicylamide production process

Aspirin was first commercially pro-

duced by Bayer in 1899. Initially, it

was sold in a powdered form and in

tabbletts since 1904. Aspirin usage

in Russia dates back its history to

1901. The country’s own production

of this medicine began after WW1,

when German supplies halted. In

the former Soviet Union, commer-

cial production of aspirin started at

powerful new plants during the first

five-year plans.



was large-scale acetylsalicylic acid produc-tion there. Among pharmaceutical enterprises, only Irbit Pharmaceutical Chemistry produc-tion plant (Irbit, Sverdlovsk region) has at its disposal chemical synthesis of such pharma-ceutical active ingredients as salicylic and acetylsalicylic acids. But the company is not synthesising the above-mentioned chemicals currently processing (re-crystallising) techni-cal foreign salicylic acid into a purified active ingredient fit for pharmaceutical production at its existing production facilities.

Usolye-Sibirskiy khimiko-farmatsevtich-eskiy zavod (Usolye-Sibirskoye chemical and pharmaceutical plant; Usolye-Sibirskoye, Irkutsk region) has developed its own methyl-salicylate synthesis technology, but its produc-tion volumes are rather small and sporadic.

Thus, CIS countries meet their salicylates demand via import deliveries. Besides, ace-tylsalicylic acid is imported both as an active ingredient for pharmaceutical production (API) and as finished dosage forms. Our analysis of export-import operations will cover only API forms.

Russia

Russian imports of salicylates for 2011 amounted to 192,47 tonnes, a 28,5% YOY

increase (Figure 7). Next year the import supplies virtually remained at the same level equalling 191,8 tonnes (-0,36%). About 87% of this figure fell on salicylic acid proper. The rest 13% were imported in the form of sodium salicylate mainly used as a preserving antiseptic for shampoos and other cosmetics.

Chinese suppliers dominated the Russian market in salicylic acid and sodium salicy-late with a 45% share in 2012 (Figure 8). Among the producers from China, we can single out the following ones: Hebei Haihua Energy Development Group (45.8 tonnes) and JQS (Huayin) Pharmaceutical (28 tonnes). Romania, namely, Romfarmachim (54 tonnes) is in second place. About 20% or 37.8 tonnes were delivered from France represented predominantly by Rhodia Operations’s products.

In 2012, Kontur LLC located in St. Petersburg imported 54 tonnes of salicylic acid becoming the biggest its Russian importer with a 28% share (Figure 9). In addition, this enterprise was the only one to buy salicylic acid made by Romfarmachim. The product was used for cosmetics manu-facture. Altair LLC (St. Petersburg) and

Eurohim-1 CJSC (Moscow) occupied 15% shares each in total Russian imports. Altair imported 29.3 tonnes of salicylic acid and sodium salicylate by Hebei Haihua Energy Development Group Co. Ltd in 2012. All this volume was meant for paints and coat-ings applications. Eurohim-1 purchased 28 tonnes of salicylic acid from JQS (Huayin) Pharmaceutical Co. Ltd. Uralchimplast JSC (Nizhny Tagil) imported 21 tonnes for intra-

Figure 6. Breakdown of salicylic acid applications worlwide in 2012

Figure 7. Russian imports of salicylates in 2010-12, tonnes

Figure 8. Geographical breakdown of Russian salicylic acid imports in 2012

Figure 9. Basic Russian importers of salycilic acid and its salts in 2012



plant consumption, which makes up 11% of total imports. This company utilises saly-cilic acid as a catalyst for furan resins syn-thesis. Moscow-based ChemPartners CJSC

bouhgt 16 tonnes of technical salicylic acid from Hebei Haihua Energy Development Group Co. Ltd (China) further used in ani-line dyes manufacture. The rest acid was basically imported for the needs of the cos-metics industry. For pharmaceutical pur-poses, salycilic acid was purchased from abroad by Russopharm LLC (10 tonnes) and Khimiko-farmatsevticheskiy kombinat Akrikhin JSC (Chemical and pharmaceuti-cal integrated works Akrikhin; 0.7 tonnes). It is Rhodia that exports to Russia salycilic acid for pharmaceutical purposes.

Salicylates were not supplied to Russia in 2010–11. In 2012, 7.5 tonnes of them were imported. The country’s imports of acetylsalicylic acid in 2011 equalled 1,348.9 tonnes, which is 5.7% higher than in 2010 (1,430.4 tonnes). A year later foreign deliv-eries continued declining totalling 1,175.6 tonnes (-12,8%). Chinese suppliers com-pletely monopolised the Russian market in acetylsalicylic acid, namely, Shandong Xinhua Pharmaceutical (580,65 tonnes) and Hebei Jingye Chemical Engineering (580 tonnes) with a 49% combined market share. JQC (Huayin) Pharmaceuticals (15 tonnes; 1,3%) should also be mentioned. Among Russian importers, the leader was Moscow-based Indukern-Rus LLC. The latter pur-chased 540 tonnes of acetylsalicylic acid from Hebei Jingye Chemical Engineering Co. Ltd. Indukern-Rus had a 46% share in total imports (Figure 10). Pharmstandard LLC (Moscow) bought 368 tonnes (31%) of the products from Shandong Xinhua Pharmaceutical Co. Ltd, which also made supplies to Protek-SVM LLC (Moscow; 102,65 tonnes). In addition, Protek-SVM purchased 15 tonnes of the chemical from JQC (Huayin) Pharmaceuticals Co. Ltd. Irbit Pharmaceutical Chemistry production plant (Irbit, Sverdlovsk region) imported 60 tonnes of acetylsalicylic acid by Shandong Xinhua Pharmaceutical Co. Ltd., occupying a 5.1% share in total imports. Finally, Uralbiopharm JSC (Yekaterinburg) and Asfarma LLC (Anzhero-Sunzhensk, Kemerovo region)

bought 40 tonnes each accounting for 3.4% each.

Ukraine

Salicylic acid and its derivatives are exported to Ukraine in relatively low volumes. For example, their annual imports were no greater than 26 tonnes for the 2009–12 period (Figure 11). Between January and July of the last year, only 15.4 tonnes were delivered to the country from abroad. Of this amount, 60% (9.3 tonnes) of the Chinese products were purchased by Macrochem PJSC.

Supplies of esters of salicylic acid to Ukraine over the last three years were a little bit higher. In 2012, the imports of these prod-ucts saw an impressive 87% YOY hike, to 27,17 tonnes. From January to July of 2013, Ukraine imported 18 tonnes of esters of saly-cilic acid, and the share of methyl salicylate among them was 72% (13 tonnes). The main buyer of methyl salicylate in Ukraine was also Macrochem, which imported 12 tonnes of the Chinese products.

Acetylsalicylic acid accounts for the lion’s share of total Ukrainian imports of all derivatives of salicylic acid. For instance, the country imported 468,76 tonnes of this product in 2010, which is 10% more as com-pared to 2009 (426,43 tonnes). A year later, a 5% YOY reduction in supplies occurred, to 444,73 tonnes. The year 2012 was the only one when imports fell below 400 tonnes over the past five years. To be precise, foreign sup-plies showed a 18% YOY decline, to 360,89 tonnes in 2012. However, the imports of salicylic acid rose to 422,8 tonnes for the first seven months of the past year. Like the Russian market, the Ukrainian one is domi-nated by Chinese suppliers with a 90% share.

The largest Ukrainian importer of acetyl-salicylic acid accounting for 51% of overall purchases from abroad is Farmatcevtichna firma Darnitsa PJSC (Kyiv) – one of the leaders of the Ukrainian pharmaceutical market. Darnitsa imported 216,55 tonnes of acetylsalicylic acid of Chinese origin for

Figure 10. Basic Russian importers of acetylsalycilic acid in 2012

Figure 11. Ukrainian imports of salicylic acid and its derivatives in

2009–13, tonnes



the first seven months of 2013. Lubnyfarm JSC (Lubny, Poltava region) with 15% purchased 65 tonnes over the same period. Stiroloptfarmtorg LLC established on the basis of Kyiv’s representative office of Stirolbiofarm (Horlivka, Donetsk region) bought 49 tonnes (12%) of foreign acetylsali-cylic acid followed by Kievmedpreparat JSC (Kyiv) — 39 tonnes (9%).

Belarus

The only big producer of aspirin in Belarus is Borisovskiy Zavod Medicinskikh Preparatov OJSC (Borisov, Minsk region) using imported salicylic acid for making its own drugs. Acetylsalicylic acid accounted for 96–98,5% of total Belarusian imports of salicylic acid and its derivatives in 2009-2012. In 2010, the imports of this substance enjoyed a staggering 70% YOY rise, to 345.3 tonnes. Further, supplies reduced to 250 tonnes (-27,6%) in 2011 and hit a bottom of 218,2 tonnes (-12,7%) in 2012. Salicylic acid and other its derivatives are imported into Belarus in small amounts. For instance, over-all supplies of these products did not exceed 3,5 tonnes in 2012 (Figure 13).

Kazakhstan

Against the background of the above-men-tioned countries, Kazakhstan is distinguished with insignificant consumption volumes of salicylic acid and its derivatives in primary forms. Most likely, this can be explained by predominant imports of prepackaged, fin-ished pharmaceutical products. The annual imports of salicylic acid and its salts during the 2011-2012 period did not exceed 4 tonnes (Figure 14). The situation with consumption of salicylic acid derivatives in the form esters and their salts is similar. In 2010-2012, ace-tylsalicylic acid supplies did not go beyond 9 tonnes.

Thus, acetylsalicylic acid in the form of a substance for pharmaceutical production is imported in large quantities only into

Russia, Ukraine and Belarus. Kazakhstan and other former Soviet states mainly purchase prepackaged, finished pharma products pro-duced from the acid.

Сonclusion

In CIS countries, salicylic acid, aspirin and other related derivatives are not synthesised, while existing production plants are idled or used for processing technical salicylic acid and aspirin into the products fit for pharma-ceutical production. The market in salicylic acid in the form of the substance for pharma-ceutical manufacture is virtually completely monopolised by suppliers from China. CIS pharmaceutical companies are only engaged in processing the active substance of Chinese origin into medicines under their own brands. Consumers from the former Soviet Union are unlikely to see in pharmacies aspirin made of domestically-made salicylic acid. However, demand for both salicylic acid and aspirin will probably grow in accord with global trends. This, in turn, will stimulate imports of salicylicand acetylsalicylic acids. As for ace-tylsalicylic acid, there is an obvious increase in its imports as both a substance for phar-maceutical production and a finished pharma product.

Figure 12. Basic Ukrainian importers of acetylsalicylic acid in 2013

Figure 14. Kazakh imports of salicylic acid and its derivatives in 2009-2012,

tonnes

Figure 13. Belarusian imports of salicylic acid and its derivatives in

2009–2012, tonnes


Organics Prices www.chemmarket. info

Prices for some organic chemicals produced in Russia, Turkmenistan, Uzbekistan, Belarus in 1Q, 2014

Product Manufacturer City Country NotesPrice per tonne,

ex. VAT

Acetic acid synthetic, 70% Navoiyazot JSC Navoiy Uzbekistan In bulk 1100 USD

Acetic acid synthetic, 99.6% Navoiyazot JSC Navoiy Uzbekistan In bulk 1100 USD

Acetic aldehyde, 0.788 g/cm³ density


Acetone technical, 99-99.75% Navoiyazot JSC Navoiy Uzbekistan 6486665 UZS

Acetylene, 98.8% Chelyabtehgaz Ltd Chelyabinsk Russia 5 liter balloon, 1 kg 260 RUR / kg

Acetylene, 99.1% Navoiyazot JSC Navoiy Uzbekistan33 USD / gas-

cylinder

Benzene petroleum purified, 99.8%

Uralorgsintez JSC Chaykovsky (Perm

territory)Russia 27966 RUR

Benzene petroleum purified, 99.8%

SIBUR-Kstovo Ltd Kstovo (Nizhny

Novgorod region)Russia 27966 RUR

Benzene petroleum refined, 99.8%

Mozyr Refinery JSCMozyr (Homiel


Benzene petroleum refined, 99.8%

Naftan JSCNavopolatsk

(Vitsebsk region)Belarus EXW 6677400 BYR

Benzene petroleum, for synthesis, 99.7%



Benzene petroleum, highest purification, 99.9%


region)Belarus EXW 6677400 BYR

1-Bromonaphthalene, pure, 97%

Chemical line Ltd St. Petersburg Russia Packing 1.5 kg 1864 RUR / kg

Butane or a mixture of butane, 85% butane and 15% butylene

Sterlitamak Petrochemical Plant

JSC

Sterlitamak (Republic of Bashkortostan)

RussiaCisterns / Automotive

fuel component11600-11900 RUR

Butane technical, 60% of butane and butylene



Butane, 85% butane, 15% butylene

Sterlitamak Petrochemical Plant

JSC


Russia Component of petrol 10800 RUR

Butylene-butadiene fraction not hydrogenated, grade A, 98% of C4 and 40% of butadiene-1.3


Novgorod region)Russia

Raw material for rubber production

36017 RUR

Butylene-butadiene fraction, not hydrogenated, grade B, 98% of C4 and 30% of butadiene-1.3



Raw material for rubber production

30127 RUR

Cyclohexane technical, 99.8-99.9%

Shchekinoazot UCC JSC

Schekino (Tula region)

Russia 85000 RUR

Cyclohexane technical, 99.9% KuibyshevAzot OJSCTogliatti (Samara

region)Russia

EXW / Tank cars (50 tonnes), boiler trucks/

For chemical fibres and solvent

75000 RUR

Ethylbenzene technical, 99.8%

SIBUR-Khimprom CJSC

Perm Russia

Raw material for styrene, component

of motor fuels, solvent

34746 RUR


Organics Priceswww.chemmarket. info


ex. VAT

Ethylbenzene technical, 99.8%



Raw for production of styrene, a component of motor fuel, solvent

34746 RUR

2-Ethylhexanoic acid, synthetic oily C8

SIBUR-Khimprom CJSC


2-Ethylhexanol technical, 99%

SIBUR-Khimprom CJSC

Perm Russia

For synthesis of plasticisers,

stabilisers, additives for lubricating oils,

solvents

54237 RUR

Ethylene oxide purified, 99.9%

SIBUR-Neftekhim JSCDzerzhinsk (Nizhny Novgorod region)

RussiaFor obtaining high-

purity ethylene glycol46610 RUR

Formalin, 36.9-37.5% Navoiyazot JSC Navoiy Uzbekistan 315 USD

Hexamethylenetetramine stabilized technical, 98% of amines

Metafrax JSCGubakha (Perm

territory)Russia

EXW / PP bags 25 kg, rail-cars 50-60 tonnes

For production of phenol-formaldehyde

resins

38500 RUR

Hexamethylenetetramine technical, 98-99.5% of amines

Metafrax JSCGubakha (Perm

territory)Russia

EXW / PP bags 25 kg, rail-cars 50-60 tonnes

For production of phenol-formaldehyde

resins

38500-40500 RUR

Hexamethylenetetramine technical, tableted, 98-99.5% of amines


Isobutane fraction, 97% Kinef LtdKirishi (Leningrad

region)Russia 16697-18054 RUR

Isobutane fraction, 98%SIBUR-Khimprom

CJSCPerm Russia

In production of rubber, polyethylenes,

polypropylenes, polystyrenes

17797 RUR

Isobutane fraction, 98%Tobolsk-Neftekhim

LtdTobolsk (Tyumen

Region)Russia 17797 RUR

Isobutane fraction, 98% Uralorgsintez JSC Chaykovsky (Perm


Methanol technical, 99.95% Navoiyazot JSC Navoiy Uzbekistan 350 USD

Methanol, 99.95%,Shchekinoazot UCC

JSCSchekino (Tula


Methyl chloride technical, 90%

Kaustic JSC Volgograd Russia 47000-70000 RUR

Methyl-tert-butyl ether, 98%SIBUR-Khimprom

CJSCPerm Russia 44068 RUR

Methyl-tert-butyl ether, 98% Uralorgsintez JSC Chaykovsky (Perm


Methyl-tert-butyl ether, 98%Tobolsk-Neftekhim

LtdTobolsk (Tyumen

Region)Russia 44068 RUR

Methyl-tert-butyl ether, 98% Togliattikauchuk Ltd Togliatti Russia 44068 RUR

Methylacetylene-allene fraction


(Vitsebsk region)Belarus Welding gas 900 EUR


Organics Prices www.chemmarket. info


ex. VAT

N, N-dimethyl-p-phenylenediamine, 98%

Krauft Ltd St Petersburg RussiaExtractant, chemical

raw material13559 RUR / kg

N, N-dimethyl-p-phenylenediamine, analytical grade, 1.09 g/cm3

Chemical line Ltd St. Petersburg Russia 13559 RUR / kg

Propane technical, max 75% propane and propylene

Surgutneftegas JSC Surgut (Khanty-Mansi Autonomous District)

Russia 15340 RUR

Propane-butane mixture, max 60% of butane and butylene




Turkmenbashi complex of refinery


Turkmenistan 419 USD


Shurtan Gaz Chemical Complex Unitary

Branch Establishment


province)Uzbekistan 899093 UZS

Propane-butane, 20% propane, 80% butane

Turkmenbashi complex of refinery


Turkmenistan 567-725 USD

Propane-butane, 60% butanes and butylenes

Surgutneftegaz JSC Surgut (Khanty-Mansi Autonomous District)

Russia 12213-12390 RUR

Propylene fraction, 90-98.8% SIBUR-Kstovo Ltd Kstovo (Nizhny


Propylene, 99.8% SIBUR-Kstovo Ltd Kstovo (Nizhny


Styrene, grade SDEB, 99.8%SIBUR-Khimprom


Styrene, grade SDEB, 99.8% Plastic JSCUzlovaya (Tula

region)Russia 55932 RUR

Styrene, grade SDEB, for processing, 99.8%

Plastic JSCUzlovaya (Tula


Styrene, grade SDEB, for processing, 99.8%

SIBUR-Khimprom CJSC


Toluene, 99.6-99.75% Naftan JSCNavopolatsk

(Vitsebsk region)Belarus 5951100 BYR

Vinylidene chloride technical, 99.9%

Kaustic JSC Volgograd Russia120000-130000

RUR

o-Xylene petroleum, 99.2% Naftan JSCNavopolatsk


p-Xylene petroleum, highest purification, 99.2%







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Inorganics Prices www.chemmarket. info

Prices of Russian, Belarusian, Uzbek and Turkmen chemical producers for inorganic materials and industrial gases in 1Q, 2014

Product Manufacturer City Country NotesPrice for 1

tonne, ex. VAT

Argon liquid, top grade, 99.993%

Evraz NTMK JSCNizhny Tagil

(Sverdlovsk region)Russia 16900 RUR

Aluminum nitride hexagonal, 98.5%

Timosha LtdSmolevichi (Minsk

region) Belarus

For producing components of microchips, high-power

transistors, absorbents, heat-conducting pastes and

compounds

10 USD

Aluminum oxychloride, 17- 22% Al2O3

Khimprom Ltd Kemerovo Russia EXW 20000 RUR

Aluminum oxynitride powder, 70% aluminum nitride, 30% aluminum oxide

Timosha LtdSmolevichi (Minsk

region) Belarus

For producing heat-conducting pastes and

compounds10 USD

Ammonia liquid, 99.6%Shchekinoazot UCC

JSCSchyokino (Tula

region)Russia

25000-30000 RUR

Ammonia liquid, 99.6% Navoiyazot JSC Navoiy UzbekistanMore than 2 tonnes /

refrigerant (R717)270 USD

Ammonium chloride, 99% Navoiyazot JSC Navoiy Uzbekistan Mordant in dyeing / Bags 330 USD

Argon gaseous, top grade, 99.993%

Evraz NTMK JSCNizhny Tagil

(Sverdlovsk region)Russia 95 RUR / m3

Argon liquid, 99.98% KuibyshevAzot JSCTogliatti (Samara

region)Russia

Tankers 2.5; 7.5 tonnes / Railway tanks 36 tonnes

16000 RUR

Calcium chloride calcined granulated, 90%

Khimprom Ltd Kemerovo RussiaEXW / Containers, 500 kg big

bag, 25 kg bags, rail cars4500 RUR

Calcium chloride granulated, 90-96.5%

Navoiyazot JSC Navoiy Uzbekistan 845000 UZS

Calcium chloride liquid, 32% Khimprom Ltd Kemerovo Russia EXW 4500 RUR

Calcium chloride liquid, 35% Navoiyazot JSC Navoiy Uzbekistan 300 USD

Chlorine liquid, 99.6% Kaustik JSC Volgograd Russia Сontainers 900-980 kg 30000-34000

RUR

Chlorine liquid, 99.6% Kaustik JSC Volgograd Russia Cylinders 55-60 kg30000-40000

RUR

Chlorine liquid, 99.6% Kaustik JSC Volgograd Russia In bulk 4500 RUR

Chlorine liquid, 99.6% Kaustik JSC Volgograd Russia Cisterns 50-55 tonnes 10500 RUR

Chlorine liquid, 99.6% Khimprom Ltd Kemerovo Russia EXW / In containers42500-70000

RUR

Chlorine liquid, 99.6%-99.8% Navoiyazot JSC Navoiy Uzbekistan In cisterns 140 USD

Ferric trichloride, water solution, 30%

Kaustik JSC Volgograd Russia16000-18000

RUR

Ferrum oxide (III) granulated, 95%

Evraz ZSMK JSCNovokuznetsk

(Kemerovo region)Russia

Catalyst in production of ammonia, component of ceramics, cements and

minerals paints

2650 RUR

Hydrochloric acid inhibited, 20-23%




RUR


Khimprom Ltd Kemerovo RussiaEXW / For treatment of oil

wells, etching iron, cleaning of boilers

12000 RUR

Hydrochloric acid reactive chemically pure, 35-38%

Kaustik JSC Volgograd Russia 8000 RUR


Inorganics Priceswww.chemmarket. info


tonne, ex. VAT

Hydrochloric acid synthetic technical, 31.5-36%


Hydrochloric acid synthetic technical, 31.5%


RUR

Hydrochloric acid synthetic technical, 31.5%-38%

Khimprom Ltd Kemerovo RussiaCisterns 60-70 tonnes, PE

canisters 20, 30,50 l16000-17000

RUR

Hydrochloric acid waste, 27.5%


RUR

Hydrochloric acid, reactive, chemically pure, 35-38%

Khimprom Ltd Kemerovo RussiaEXW / PE canisters 20,

30,50 l23000 RUR

Hydrochloric acid, reactive, pure, 35-38%

Khimprom Ltd Kemerovo Russia Cisterns 50 tonnes 20000 RUR

Iodine technical, 99%Balkanabat Iodine

PlantBalkanabat ( Balkan

Province)Turkmenistan Prepayment / EXW 36000 USD

Iodine technical, 99% Bereket Iodine PlantBereket (Akhal

province)Turkmenistan Prepayment / EXW 36000 USD

Iodine technical, 99% Khazar Chemical PlantKhazar (Balkan

province)Turkmenistan Prepayment / EXW 36000 USD

Magnesium chloride (bishofit) technical, grade B, solution 250-400 g/l


RUR

Magnesium chloride flake, 97%


RUR

Magnesium chloride granulated, 97%


RUR

Nitric acid weak, 56-58%, in terms of 100%

Mendeleyevskazot LtdMendeleevsk

(Republic of Tatarstan)Russia In customer’s packaging 17808 RUR

Oleum improved, 24% SO3PhosAgro-

Cherepovets JSCCherepovets (Vologda


Oleum improved, 24% SO3Balakovo Mineral

Fertilisers LtdBalakovo (Saratov


Oleum improved, 24% SO3 Shchekinoazot UCC

JSCSchyokino (Tula

region)Russia EXW

3600-5500 RUR

Phosphoric acid extraction, water solution, 40%

PhosAgro-Cherepovets JSC

Cherepovets (Vologda region)

Russia 15500 RUR

Phosphoric acid extraction, water solution, 40%

Balakovo Mineral Fertilisers Ltd

Balakovo (Saratov region)

Russia 15500 RUR

Potassium iodide, 99% Khazar Chemical PlantKhazar (Balkan

province)Turkmenistan 60000 USD

Sodium bicarbonate, 99.5% Soda JSCSterlitamak (Republic

of Bashkortostan)Russia In bulk / Bags / Big bags 11100 RUR

Sodium bicarbonate, 99% Soda JSCSterlitamak (Republic


Sodium carbonate (soda ash), grade A, 98.2%

Soda JSCSterlitamak (Republic

of Bashkortostan)Russia Big bags 800 kg

10472-10547 RUR



of Bashkortostan)Russia Bags 50 kg

10911-10986 RUR



of Bashkortostan)Russia In bulk

9592-9668 RUR

Sodium carbonate (soda ash), grade B, 97.5%

Berezniki Soda Plant JSC

Berezniki (Perm territory)

Russia In bulk 9170 RUR




Russia Big bags 650 kg 10070 RUR




tonne, ex. VAT




Russia Bags 40 kg 10470 RUR


Qo’ng’irot soda zavodi unitary enterprise

Qo’ng’irot (Karakalpakstan

province)Uzbekistan

EXW / In bulk / PP bags 35 kg

280 USD















of Bashkortostan)Russia Bags 50 kg 10564 RUR



of Bashkortostan)Russia Big bags 500 kg 10124 RUR



of Bashkortostan)Russia In bulk 9246 RUR















of Bashkortostan)Russia Bags 50 kg 10621 RUR



of Bashkortostan)Russia Big bags 500 kg 10183 RUR



of Bashkortostan)Russia In bulk 9303 RUR

Sodium carbonate (soda ash), grade А, 97.5%






































of Bashkortostan)Russia

In bulk / For production electron-tube glass

9668 RUR

Sodium carbonate (soda ash), grade К, 85%

KuibyshevAzot JSCTogliatti (Samara

region)Russia In bulk / Big bags 800 kg

6500-7500 RUR

Sodium chloride, 97.5% Guvlyduz CombineGuvlymayak (Balkan

province)Turkmenistan

Prepayment / For industrial applications

40 USD




tonne, ex. VAT

Sodium chloride, technical, purified, 99.5%


Sodium cyanide, 20-30% Navoiyazot JSC Navoiy UzbekistanGalvanising and gilding

metal products2822350 UZS

Sodium hydroxide reactive, analytical grade, 98%

Kaustik JSC Volgograd Russia 30000 RUR

Sodium hydroxide tablet, 98% Kaustik JSC Volgograd RussiaIn production of vinyl

chloride as a neutralising agent

60000 RUR

Sodium hydroxide technical granulated, 99%


RUR

Sodium hydroxide, RD grade, 44%

SIBUR-Neftekhim JSCDzerzhinsk (Nizhny Novgorod region)

Russia 17797 RUR



RUR


Khimprom Ltd Kemerovo RussiaEXW / Cisterns 55-60 tonnes (in bulk), tanks 25-27 tonnes

26500 RUR

Sodium hypochlorite, 10-20 g /l NaOH


RUR

Sodium hypochlorite, 10-20 g/l NaOH


Sodium hypochlorite, 40 g/l NaOH, 120 g/l Cl

Khimprom Ltd Kemerovo RussiaEXW / Cisterns 60-70 tonnes; PE canisters

26500 RUR

Sulphur gaseous granulated, 99.98%

Kinef LtdKirishi (Leningrad


Sulphur gaseous lumps, 99.98%

Buxoro neftni qayata ishlash zavodi

Qorovulbozor (Buxoro province)


Sulphur liquid, 99.2% Mozyr Oil Refinery JSC Mozyr (Homiel region) Belarus 437200 BYR

Sulphur liquid, 99.98% Mozyr Oil Refinery JSC Mozyr (Homiel region) Belarus 437200 BYR

Sulphur lump, 99.2% Ukrtatnafta PJSCKremenchug (Poltava

region)Ukraine Rail, road transport 842-917 UAH

Sulphur lump, 99.9%Turkmenbashi Complex of Oil

Refineries


TurkmenistanPrepayment / FCA / 50 kg

bags57 USD

Sulphuric acid accumulator, 92-94%


Schyokino (Tula region)

Russia6000-13000

RUR

Sulphuric acid contact improved, 92.5-94%



Russia EXW3500-6000

RUR

Sulphuric acid technical contact, 92.5%



Russia 2000 RUR

Sulphuric acid technical contact, 92.5%



Russia EXW2900-5000

RUR

Sulphuric acid waste, 72% Khimprom Ltd Kemerovo Russia EXW / Cisterns 50-60 tonnes 60 RUR

Sulphuric acid, grade K, 95-96.5%



Russia 2000 RUR

Sulphuric acid, high purity, 93.5-95.6%



RussiaFor production of high-tech

products and analytical materials

23000 RUR

1 EUR = 45.0559-49.5839 RUR Official exchange rate, according to the Central Bank of Russia during 1Q 2014

1 EUR = 3000.05-3053.73 UZS Official exchange rate, according to the Central Bank of the Republic of Uzbekistan during 1Q 2014

1 EUR = 3.8982-3.9159 ТМТ Official exchange rate, according to the Central Bank of Turkmenistanduring 1Q 2014



Agrochemistry www.chemmarket. info

Ammonium nitrate

In 2013, the Ukrainian enterprises turned out 2,251,800 tonnes of ammonium nitrate (see Table 1).

In December 2012 total production of NH4NO3 amounted to 173,200 tonnes (in physical terms).

In December Cherkasy-based Azot PJSC raised its ammonium nitrate output by 85.6%, to 80,000 tpy against December 2012. Rivneazot decreased output of this product by 14.5%, to 43,200 tonnes, and produc-tion at Severodonetsk Azot Association fell 4.6%, to 50,000 tonnes. Concern Stirol PJSC (Horlivka, Donetsk region) was not engaged in ammonium nitrate manufacture at all. In November 2013 the country’s enterprises produced 158,100 tonnes of ammonium nitrate (in physical terms).

Carbamide

In 2013 Ukrainian companies reduced carbamide production by 24.8% or 913,300 tonnes, to 2,774,000 tonnes over 2012 (Table 2).

In December 2013 chemical enterprises in the country cut CO(NH2)2 output (in physi-cal terms) by 65.7% or 226,300 tonnes, to 118,400 tonnes as compared to the same period of 2012.

In particular, DniproAzot PJSC increased urea

output by 6.3%, to 69,200 tonnes in December 2013 against December 2012, whereas the pro-duction of Odessa Port Plant JSC showed a 39.9% YOY fall, to 49,200 tonnes.

Severodonetsk Azot Association, Cherkasy-based Azot and Concern Stirol

Summing up Ukrainian Fertilisers Production in 2013: No Light at the End of the Tunnel

Table 1. Ammonium nitrate production in Ukraine in 2013, thousand tonnes

CompanyDecember

2013December

2012

December 2013 to

December 2012, %

2013 20122013 to 2012, %

Cherkasy-based Azot PJSC

80,0 43,1 185,6 953,7 789,3 120,8

Rivneazot JSC 43,2 50,5 85,5 530,7 500,7 106,0

Severodonetsk Azot Association PJSC

50,0 52,4 95,4 393,2 587 67,0

Concern Stirol PJSC

0,0 63,8 - 374,2 599 62,5

Total 173,2 209,8 82,6 2251,8 2476,0 90,9

Тable 2. Carbamide production in Ukraine in 2013, thousand tonnes

CompanyDecember

2013December

2012

December 2013 to

December 2012 in %

2013 20122013 to 2012, %

DniproAzot PJSC

69,2 65,1 106,3 699,5 684,1 102,3

Odessa Port Plant JSC

49,2 81,8 60,1 635,0 930,1 68,3


0,0 72,1 - 548,6 776,5 70,7

Severodonetsk Azot Association PJSC

0,0 38,4 - 314,0 404,7 77,6

Concern Stirol PJSC

0,0 87,3 - 576,9 891,9 64,7

Total 118,4 344,7 34,3 2774,0 3687,3 75,2

All in all last year proved extremely unsuccessful for Ukrainian fertilisers producers. The domestic output of the following fertilisers displayed a significant reduction in 2013 as com-pared to 2012:

ammonium nitrate – (–9.1%); urea – (–24.8%), ammophos – (–33.8%), NPK – (–47.7%), am-monium sulphate – (–49.5%). Only CAS production rose 14% in 2013. Below are given production results in detail.


Agrochemistrywww.chemmarket. info

did not produce urea in December of the past year. According to more precise data, Ukrainian CO(NH2)2 production in 2012 decreased 3.5% or 135,000 tonnes, to 3,678,200 tonnes against 2011. In November 2013 the enterprises reduced urea production (in physical terms) by 64.6% or 204,400 tonnes, to 111,900 tonnes in comparison with November 2012.

Ammophos

In 2013, ammophos production in the country plunged 43.8% or 31,300 tonnes, to 40,100 tonnes against 2012 (Table 3).

In December 2013 the output of ammophos dived 87.5% or 1,400 tonnes, to 0.2 tonnes over December 2012. In par-ticular, Dinprovskiy mineral fertilizers plant PJSC (Dniprodzerzhinsk) produced a total of 200 tonnes of ammophos, whereas Sumykhimprom PJSC (Sumy) and Crimea Titan PJSC did not manufacture this product in December at all.

According to more precise data, Ukrainian ammophos production in 2012 amounted to 71,400 tonnes. In November 2013 it slumped 97.6% or 8,000 tonnes, to 0.2 tonnes as com-pared to November 2012.

NPK

Ukrainian chemical companies reduced NPK production by 47.7% or 165,400 tonnes, to 181,100 tonnes in 2013 as compared to a year earlier (see Table 4). In December 2013 NPK output plummeted 98.2% or 10,800 tonnes, to 200 tonnes against 2012.

Dnirpovskiy mineral fertilizers plant turned out 0.2 tonnes of the product in 2013, while Sumykhimprom was not engaged in NPK production at all. According to more precise data, the Ukrainian production of NPK in 2012 totalled 346,500 tonnes. In November 2013, NPK output rose 26.3% or 3,500 tonnes, to 16,800 tonnes against November 2012.

Table 3. Ukrainian ammophos production in December, thousand tonnes

CompanyDecember

2013December

2012

December 2013 to

December 2012, %

2013 20122013 to 2012, %

Dniprovsky mineral fertilizers plant PJSC

0,2 0,0 - 14,7 19,0 77,4

Crimea Titan PJSC 0,0 1,6 - 25,4 52,4 48,5

Sumykhimprom PJSC

0,0 0,0 - 0,0 0,0 -

Total 0,2 1,6 12,5 40,1 71,4 56,2

Table 4. NPK production in Ukraine in 2013, thousand tonnes

CompanyDecember

2013December

2012

December 2013 to

December 2012, %

2013 20122013 to 2012, %

Sumykhimprom PJSC

0,0 11,0 - 180,7 343,2 52,7

Dinprovskiy mineral fertilizers plant PJSC

0,2 0,0 - 0,4 3,3 12,1

Total 0,2 11,0 1,8 181,1 346,5 52,3

Table 5. Ukrainian ammonium sulphate production in 2013, thousand tonnes

ProducersDecember

2013December

2012

December 2013 to 2012, %

2013 20122013 to 2012, %


0,0 0,0 - 32,0 63,8 50,2

Crimea Titan PJSC

0,0 0,0 - 0,2 0,0 -

Sumykhimprom PJSC

0,0 0,0 - 0,0 0,0 -

Total 0,0 0,0 - 32,2 63,8 50,5

Table 6. Production of aqueous solution of urea and ammonium nitrate in 2013, thousand tonnes

CompanyDecember

2013December

2012

December 2013 to 2012, %

2013 20122013 to 2012, %


0,0 12,7 - 204,6 190,4 107,5

Concern Stirol PJSC

0,0 0,0 - 97,9 75,0 130,5

Total 0,0 12,7 - 302,5 265,4 114,0


Agrochemistry www.chemmarket. info

Superphosphate

In 2013 Ukrainian enterprises produced a total of 10,000 tonnes of superphosphate. At the same time, the companies did not manufacture superphosphate in November

and December 2013 and in December 2012. According to more precise data, superphosphate production in the country in 2012 amounted to 100 tonnes. The only Ukrainian producer of superphosphates is Sumykhimprom PJSC.

Ammonium sulphate

In 2013 Ukraine’s output of ammonium sulphate lunged 49.5% or 31,600 tonnes to 32,200 tonnes in comparison with 2012 (Table 5). Ukrainian enterprises did not produce ammonium sulphate in November and December 2013 and the same months of 2012. According to more accurate data (NH4)2SO4 output in 2012 equalled 63,800 tonnes.

Water solution of urea and ammonium nitrate

In 2013 UAN production in Ukraine (aque-ous solution of urea and ammonium nitrate) increased 14% or 37,100 tonnes, to 302,500 tonnes as compared to 2012 (see Table 6).

In December 2013 Ukrainian companies did not produce UAN. Over the same period of 2012 they manufactured 13,200 tonnes.

According to more accurate data, the production of UAN 265,400 tonnes. In November 2013 the companies did not pro-duce UAN.

Ukrainian fertiliser exports and imports in 2013

In 2013 Ukrainian exported fertilisers worth USD 1.17bn, while the country’s imports amounted to USD 815.8m (Table 7). In December the country exported fertilisers at the amount of USD 56m, and imports totalled USD 66.3m. Nitrogen fertilisers were in the highest demand in December. Their exports amounted to 55.6m. In November Ukraine exports of mineral fertilisers were worth USD 70.5m, the imports – USD 38.5m.

The article is based upon data provided by the

the Cherkasy State Scientific Research Institute

of Technical and Economic Information in the

Chemical Industry and by information agency

Ukrainian News.

Table 7. Ukrainian imports and exports in 2013, million dollars

СтранаImports Exports

December 2013 December 2013

Nitrogen fertilisers

Russia 34,33 205,04 - -

Other 0,78 3,45 33,12 627,75

Poland 0,13 1,83 - -

Uzbekistan 0,43 1,49 - -

Turkey - - 20,87 295,41

Italy - - 1,61 103,33

Brazil - - - 107,05

Total 35,68 211,82 55,60 1 133,53

Phosphorus fertilisers

Russia - 0,34 - -

Total - 0,34 - -

Potassium fertilisers

Belarus 2,58 68,16 - -

Russia 0,36 1,95 0,02 0,18

Other 0,01 1,23 - 0,02

Belgium 0,02 1,11 - -

Lithuania - - 0,02 0,59

Turkey - - - 0,04

Total 2,97 72,44 0,04 0,83

Mixed type fertilisers (10 kg bags)

Russia 21,64 393,22 - -

Belarus 3,71 80,30 - -

Other 1,99 48,28 0,38 10,96

Finland 0,30 9,48 - -

Ivory Coast - - - 9,54

Moldova - - - 4,97

Benin - - - 11,26

Total 27,65 531,28 0,38 36,72

Grand total 66,30 815,88 56,02 1 171,08


Agrochemistry Priceswww.chemmarket. info

Prices for mineral fertilisers of Russian, Uzbek, Turkmen, and Ukrainian manufacturers in 1Q, 2014

Product Manufacturer City Country NotesPrice per

tonne, ex. VAT

Ammonia water, 20.5%Dneprovskyy Plant of Chemical Fertilisers

PJSC

Dniprodzerzhynsk (Dnipropetrovsk

region)Ukraine In bulk / EXW, Rail-car norms 1350 UAH

Ammonia water, 25% N KuibyshevAzot OJSCTogliatti (Samara


Ammonia water, 25% N Navoiyazot JSC Navoiy Uzbekistan EXW 170 USDAmmonium nitrate with magnesium additive, 37.4% N

Mendeleyevskazot LtdMendeleyevsk

(Republic of Tatarstan)Russia In bulk 10299 RUR

Ammonium nitrate with sulphur crystalline ammonium sulphate, grade 6S, N-31%, S-6%

KuibyshevAzot OJSCTogliatti (Samara

region)Russia Big bags 950 kg 8228 RUR

Ammonium nitrate with sulphur with granulated ammonium sulphate, grade 6S, N-31%, S-6%


region)Russia Big bags 950 kg 8394 RUR

Ammonium nitrate, 34.4% N Acron JSCVeliky Novgorod

(Novgorod region)Russia

FCA / In bulk / For agricultural producers

10350 RUR

Ammonium nitrate, 34.4% NAzot Branch of Uralchem JSC


RussiaFCA / In bulk / For agricultural

producers10050 RUR

Ammonium nitrate, 34.4% N KuibyshevAzot OJSCTogliatti (Samara

region)Russia

In bulk / For agricultural producers

9800 RUR

Ammonium nitrate, 34.4% NMaryazot production

associationMary Turkmenistan Prepayment 360 TMT

Ammonium nitrate, 34.4% N Mineral fertilisers JSCRossosh (Voronezh

region)Russia


9700-10000 RUR

Ammonium nitrate, 34.4% N Minudobreniya JSC Perm RussiaFCA / In bulk / For agricultural

producers9700-10050

RURAmmonium nitrate, 34.4% N Navoiyazot JSC Navoiy Uzbekistan In bulk 230 USD

Ammonium nitrate, 34.4% NNevinnomysskiy Azot

JSCNevinnomyssk

(Stavropol territory)Russia In bulk / Bags

10300-10600 RUR

Ammonium nitrate, 34.4% NNovomoskovskiy Azot

JSCNovomoskovsk (Tula

region)Russia In bulk / Bags, big bags

9900-10200 RUR

Ammonium nitrate, 34.4% NPhosAgro-Cherepovets

JSCCherepovets (Vologda

region)Russia


7095-9195 RUR

Ammonium nitrate, 34.4% NVoskresensk Mineral

Fertilisers JSCVoskresensk (Moscow

region)Russia


10050 RUR

Ammonium nitrate, 34.4% N Dorogobuzh JSCVerkhnedneprovsky

Settlement (Smolensk region)


producers10350 RUR

Ammonium nitrate, 34.4%NMineral fertiliser Plant

of Kirovo-Chepetsk Chemical Works JSC

Kirovo-Chepetsk (Kirov region)


producers9700 RUR

Ammonium sulphate, 21% N KuibyshevAzot OJSCTogliatti (Samara

region)Russia

PP bags 50 kg / Big bags 800 kg

6300-6900 RUR

Ammonium sulphate, 21% N Maxam-chirchiq JSCChirchiq (Toshkent

province)Uzbekistan EXW 225430 UZS

Ammonium sulphate, 21% N Navoiyazot JSC Navoiy Uzbekistan Bags 50 kg 140 USD

Ammonium sulphate, 21% NShchekinoazot UCC

JSCSchyokino (Tula


Calcium ammonium nitrate (CAN), 27% N, 4% CaO

Novomoskovskiy Azot JSC

Novomoskovsk (Tula region)

Russia In bulk / Bags8350-8650

RURCalcium dihydrogen phosphate monohydrate (monocalcium phosphate), 16% Сa, 22% P

Balakovo Mineral Fertilisers Ltd

Balakovo (Saratov region)

RussiaEnables gain of live weight of animals and birds by 5-12%

23282 RUR


Agrochemistry Prices www.chemmarket. info


tonne, ex. VAT

Complex liquid fertiliser slurry NP 6-24

Dneprovskyy Plant of Chemical Fertilisers

PJSC


region)Ukraine In bulk / EXW, Railway norms 2667 UAH

Complex liquid fertiliser slurry NP(S) 8:22(10)


PJSC


region)Ukraine In bulk / EXW, Railway norms 2667 UAH

Complex liquid fertiliser, sulphur-containing nutrient solution, 7% N, 8% S, 30-40% ammonium sulphate


region)Russia

In bulk / Tank container 18-19 tonnes

1542 RUR

Magnesium sulphate technical, 91.7%

Maxam-chirchiq JSCChirchiq (Toshkent

province)Uzbekistan EXW 1090835 UZS

Nitrogen-calcium-magnesium fertiliser, grade B, 33% N, 4% CaO

Azot JSC Kemerovo Russia In bulk 9900 RUR

Nitrophosphate 22-28% N; 1-6% P


NP 10-46 Ammofos-Maxam JSCOlmaliq (Toshkent

province)Uzbekistan In bulk 774113 UZS

NP 12-52EuroChem –

Belorechenskie Minudobrenia JSC

Belorechensk (Krasnodar territory)

Russia In bulk / Bags, big bags15600-15900

RUR

NP 12-52PhosAgro-


region)Russia

FCA / Big bags 800 kg, bags50 kg

15380 RUR

NP 12-52Phosphorit Industrial

Group LtdKingisepp (Leningrad


15600-15900 RUR

NP 12-52Voskresensk Mineral


region)Russia


14600 RUR

NP 18-46PhosAgro-



NP 18-47Phosphorit Industrial

Group LtdKingisepp (Leningrad


15600-15900 RUR

NP(S) 17-17(40)Dneprovskyy Plant of Chemical Fertilisers

PJSC


region)Ukraine

Rail-car norms / EXW (Bags 50 kg or big bags)

3333-3417 UAH

NP(S) 20-20 (8)EuroChem –

Belorechenskie Minudobrenia JSC

Belorechensk (Krasnodar territory)


RUR

NPK 10-26-26PhosAgro-


region)Russia


12414 RUR

NPK 10-26-26Voskresensk Mineral


region)Russia


14000 RUR



region)Russia

In bulk / Big bags 800 kg, bags 50 kg

10650 RUR



region)Russia

In bulk / Big bags 800 kg, bags 50 kg

10195 RUR

NPK 16-16-16 Acron JSCVeliky Novgorod

(Novgorod region)Russia


12180 RUR

NPK 16-16-16 Mineral fertilisers JSCRossosh (Voronezh

region)Russia


11950 RUR

NPK 16-16-16Nevinnomysskiy Azot

JSCNevinnomyssk

(Stavropol territory)Russia In bulk / Bags, big bags

11100-11400 RUR

NPK 16-16-16 Dorogobuzh JSCVerkhnedneprovsky

Settlement (Smolensk region)


producers 12180 RUR


Agrochemistry Priceswww.chemmarket. info


tonne, ex. VAT

NPK 17-0,1-28Nevinnomysskiy Azot

JSCNevinnomyssk

(Stavropol territory)Russia

In bulk / PP Bags, big bags 500 kg

10000-10300 RUR

NPK 21-0,1-21Nevinnomysskiy Azot

JSCNevinnomyssk

(Stavropol territory)Russia

In bulk / PP Bags, big bags 500 kg

8800-9100 RUR

NPKS 5-16-30-10Dneprovskyy Plant of Chemical Fertilisers

PJSC


region)Ukraine


3583-3625 UAH

NPKS 7-21-21-13Dneprovskyy Plant of Chemical Fertilisers

PJSC


region)Ukraine


3583-3625 UAH

Phosphogypsum, 90% CaSO4Dneprovskyy Plant of Chemical Fertilisers

PJSC


region)Ukraine 45-58 UAH

Potassium chloride powder, 95% KCL

Uralkali Combined Company


RussiaIn bulk / FCA / For agricultural

producers5927 RUR

Potassium chloride, 58-60% K2ODehkanabad Potash

Plant Unitary Enterprise

Dehqonobod (Qashqadaryo region)

Uzbekistan EXW 757308 UZS

Potassium fertiliser iquid APP 11-37, 11% N, 37% P



RussiaFCA / For agricultural

producers13013 RUR

Potassium nitrate, 34% P, 12.2% N


Potassium sulphate, 48% K2O Maxam-chirchiq JSCChirchiq (Toshkent

province)Uzbekistan Bags 4436540 UZS

Superphosphate ammoniated Turkmenabat Chemical Plant named after S.A.

Niyazov

Türkmenabat (Lebap province)

Turkmenistan Prepayment 500 TMT

Superphosphate ammoniated granulated, 13%

Qo’qon superfosfat zavodi JSC

Qo’qon (Farg’ona province)


Superphosphate double NP 10-32, (20) CaO-14%


PJSC


region)Ukraine


3583-3667 UAH

Superphosphate granulated enriched N-P-Ca-S-Mg 6-26-(12-17)-(8-10)-0.5

Phosphorit Industrial Group Ltd

Kingisepp (Leningrad region)


RUR

Suprefos-NS, NPCaS 12-24-14-25

Ammofos-Maxam JSCOlmaliq (Toshkent

province)Uzbekistan Bags 443258 UZS

UAN-28, 28% N KuibyshevAzot OJSCTogliatti (Samara


UAN-32, 32% N Maxam-chirchiq JSCChirchiq (Toshkent

province)Uzbekistan In bulk 252500 UZS

UAN-32, 32% NNevinnomysskiy Azot

JSCNevinnomyssk

(Stavropol territory)Russia In cisterns 8900 RUR

UAN-32, 32% NNovomoskovskiy Azot

JSCNovomoskovsk (Tula

region)Russia In cisterns 7900 RUR

Urea, 46.2% N Farg’onaazot JSC Farg’ona Uzbekistan In bulk 485807 UZS

Urea, 46.2% NGazprom Neftekhim

Salavat JSCSalavat (Republic of

Bashkortostan)Russia FCA / In bulk 10576 RUR

Urea, 46.2% N KuibyshevAzot OJSCTogliatti (Samara

region)Russia


11510 RUR

Urea, 46.2% NPhosAgro-Cherepovets

JSCCherepovets (Vologda

region)Russia


10955 RUR

Urea, 46.2% N Tejen Carbamide Plant Tejen (Ahal province) Turkmenistan Prepayment 400 TMT






Specialty chemicals Prices www.chemmarket. info

Prices for some specialty chemicals produced in Russia, Belarus, Uzbekistan, Turkmenistan and Ukraine in 1Q, 2014


tonne, ex. VAT

Acrylic emulsion, polymerisation product of methyl acrylate ester, 20% solids

Navoiyazot JSC Navoiy UzbekistanFor leather finishing and

nonwovens4800 USD

Acrylonitrile technical, 0,008-0,806 g/cm3 density

Navoiyazot JSC Navoiy Uzbekistan

For production of butadiene - nitrile rubber, synthetic fibers, plastics, ABC, SAN - plastic, acrylamide, methyl acrylate, glutamic acid, as insecticide

2400-2600 USD

Additive high-octane motor / product of esterification of olefins with methanol, 5% actual resin

Togliattikauchuk Ltd Togliatti Russia 29237 RUR

Alcaline Adipate Plastificator (AAP), 18-30% sodium adipate



RussiaUsed for the production of

building materials, oil and gas extraction (upstream processes)

4600-6900 RUR

Aluminum potassium sulphate, pure for analysis

Promchimperm CJSC Perm RussiaBag 50 kg / coagulant in pulp and

paper industry26 RUR / kg

Ammonium alum alumina, pure

Promchimperm CJSC Perm RussiaBags 50 kg, big bags 700 kg /

Raw materials For production of synthetic crystals (corundum)

20 RUR / kg

Ammonium nitrate, grade A, 98%


region)Russia

In bulk / PP bags 50 kg / Big bags 800 kg / Components of

explosive

9530-9800 RUR

Benzene-toluene fraction (bentol), 20-50% benzene, 50-80% toluene

SIBUR-Khimprom CJSC

Perm Russia Ovtane booster 27966 RUR

Benzene-toluene fraction (bentol), 20-50% benzene, 50-80% toluene

Plastic JSCUzlovaya (Tula

region)Russia Ovtane booster 27966 RUR

Bischofite brine, GreenRide Kaustik JSC Volgograd Russia15000-17000

RUR

Calcium and magnesium carbonate (dolomite powder), 40% CaO, 22% MgO

R&D enterprise Kaltsyt Ltd

Donetsk UkraineAs flux, refractories, for

magnesium792 UAH

Calcium carbonate dispersed technical MTD-2, 98%

Volcheyarovsky Quarry PJSC

Lisichansk (Luhansk region)

Ukraine 458 UAH

Calcium carbonate milled MM-3



Ukraine For building mixes 350 UAH

Calcium carbonate milled separated MMS-2, 98%



UkraineUsed inpolymer, paint, rubber

and cable industry525-558 UAH

Calcium carbonate milled separated ММS-1, 98.2%



UkraineUsed in plastic, paint, rubber and

cable industry550-583 UAH

Calcium carbonate MMK, powder feed, 98%



Ukraine 350-425 UAH

Calcium carbonate MMZHP, powder



Ukraine For feeding animals and birds 392 UAH


Specialty chemicals Priceswww.chemmarket. info


tonne, ex. VAT

Calcium chloride technical, inhibited, 80%

Khimprom Ltd Kemerovo RussiaEXW / Big bags 500 kg, bags 25

kg, rail-cars21000 RUR

Carbon black K-354Khazar Chemical

PlantKhazar (Balkan

province)Turkmenistan 2350 USD

Carboxymethylcellulose, 50-60%

Cellikom JSCKazan (Republic of

Tatarstan)Russia

29661-61017 RUR

Cellulose trinitrate / Pyroxylin

Tambov Powder Plant FSE

Kotovsk (Tambov Region)

RussiaFor obtaining smokeless powder, dynamite, explosives / reusable

packaging 18-22kg248500 RUR

Chladone R600a (isobutane)

Promchimperm CJSC Perm Russia Container 400 kg 200 RUR / kg

Colloxylin solution in organic solvents / Mastic, 22%

Tambov Powder Plant FSE

Kotovsk (Tambov Region)

RussiaFormanufacture of binding

materials and artificial leather82797 RUR

Copper oleateTambov Powder Plant

FSEKotovsk (Tambov

Region)Russia

Antiwear additive for internal combustion engine

327966 RUR

Dibutyl phthalate, density 1.045-1.049 g/cm3

Lakokraska JSC Lida (Grodno region) Belarus Plasticiser23779000-25081000

BYR

Diethyleneglycol, 99.5%SIBUR-Neftekhim

JSCDzerzhinsk (Nizhny Novgorod region)

RussiaPlasticiser of film materials,

adhesives40254 RUR

Dimethylamine, 40%Scientific and

Industrial Association Tehnolog JSC


RussiaFor rubber, dimethylformamide, dimethylacetamide, in organic

synthesis / Barrel 216.5 l40000 RUR

Dipentene (1-methyl-4-iso propenyl cyclohexen-1), 0.8411 g/cm3 density

Delios Ltd Dzerzhinsk (Nizhny Novgorod region)

Russia

For obtaining alkyd resins, terpene resins, carvone,

rubber chemicals, substitute of chlorinated solvents inprinting

industry

271186 RUR

Filler Carbosil, grade KS-20, 20% carbon, 70% silicon dioxide

Ecochemmach JSCBuy (Kostroma

region)Russia

For rubber, paint materials / Bags 20 kg

12797 RUR

Flocculant PAA-GS / Polyacrylamide granulated 50-56%, sulphate ammonia 34-40%, mixture


Flocculant for obtaining explosives, gels for chemical

analysis, and in gold mining, coal mining

3680 USD

Gum rosin, non-crystallisable, modified


region)Belarus

For producing electrical insulation / For cable

31020000 BYR

Gum rosin, pine, 6% unsaponifiables


region)Belarus For rubber production / In bulk

28200000 BYR

Gum turpentine, 60% α and β-pinenes


region)Belarus

In bulk / Feedstock for organic synthesis

23970000 BYR

Hexachloroparaxylene Hepsol-HKP, 53-62% Cl


RUR

Inhibitor of sediments mineral salts IOMS-1 / 25% sodium salts aminomethylene phosphonic acids of nitrilotrimethylphosphonic acid

Chemical company Niton JSC

Yekaterinburg (Sverdlovsk region)

Russia For water treatment 50848 RUR




tonne, ex. VAT

Inhibitor of sediments mineral salts IOMS-1M, 25% Na3NTF




Inhibitor of sediments mineral salts Zn-OEDFK / Oxyethylidene diphosphonic acid zinc complex, 20-25%




Inhibitor of sediments mineral salts, corrosion and biofouling, grade KISK-2, KISK-B / sodium salts of organic phosphonic acid water solution




Inhibitor of sediments of mineral salts IOMS-2, 25% Na3NTF




Inhibitor Zn-IOMS / mixture of sodium salts nitrilotrimethylphosphonic methyliminobismethyl- phosphonic acids and complexes of zinc, 25% organophosphate




Lanthanum nitrate, pure, 98%

Centers of technology Lantan Ltd

Novosibirsk RussiaFor production of highoctane

gasoline and hydrogen batteries of mobile phones

26 USD

Monoethyleneglycol, 99.5%

SIBUR-Neftekhim JSC

Dzerzhinsk (Nizhny Novgorod region)

Russia 44068 RUR


SIBUR-Neftekhim JSC


Russia 44068 RUR


SIBUR-Neftekhim JSC


Russia 27966 RUR

Neutral cake soda calcinated



RussiaUsed for the production of

building materials, oil refining (downstream processes)

9700 RUR

Nickel nitrate, 98%Centers of technology

Lantan LtdNovosibirsk Russia

For production of alkaline batteries

230 RUR / kg

Oligoetheracrylates MGF-9 Armoplast PJSCSievierodonetsk (Luhansk region)

Ukraine

Binder inproduction of reinforced plastics, protective coatings, building materials, electrical

insulating compounds, lacquers, enamels, adhesives

83333 UAH

Oligoetheracrylates MGF-9CHIMEX Limited

CJSCSt. Petersburg Russia 381356 RUR

Oligoetheracrylates TGM-3 Armoplast PJSCSievierodonetsk (Luhansk region)

UkraineMonomers for production of

resins85000 UAH

Paraffin crude fraction II Farg’ona Refinery unitary subsidiary

Farg’ona Uzbekistan For production hard paraffin 600 USD

Paraffin in styrene solution, density 0.901-0.903 g/cubic meter

Zhylevsky Plastics Plant OJSC


RussiaCanister 5, 10 kg / Curing

accelerator123100 RUR




tonne, ex. VAT

Paraffin petroleum solid, grade T1, T2, T3

Farg’ona Refinery unitary subsidiary

Farg’ona Uzbekistan 1358333 UZS

Paraffin сhlorinated, grade CP-250, 24-29% Cl

Kaustik JSC Volgograd RussiaFor production of coatings,

component for processing leather34900-43200

RUR


Kaustik JSC Volgograd RussiaPlasticiser in polymer

compositions34900-43200

RUR

Paraffin сhlorinated, grade CP-470А, 45-49% Cl



RUR




RUR

Paraffin сhlorinated, grade CP-66Т, 53-54% Cl

Kaustik JSC Volgograd Russia Flame retardant for paintwork

materials and plastics50000-65000

RUR

Pentaerythritol technical filtrate, 20% of sodium formate

Metafrax JSCGubaha (Perm

territory)Russia EXW / Tank-cars 50-60 tonnes 2000 RUR

a-Pinene, 95% Delios Ltd Dzerzhinsk (Nizhny Novgorod region)

Russia

For obtaining camphor, solvents paints and varnishes, raw

material for pine oil, terpineol and fragrances

135593 RUR

Pinene natural (of gum turpentine), 90%

Delios Ltd Dzerzhinsk (Nizhny Novgorod region)

Russia Used in cosmetics 118644 RUR

Polyacrylamide-gel ammoniacal, 6%


Flocculant for water purification and preparation of mineral

fertilisers, for drilling and oil production, sizing of fabric

3400-3900 USD

Polyacrylamide-gel ammoniacal, 6%

Zavod imeni Sverdlova Federal

government enterprise


RussiaFlocculant for natural and waste water, to trap heavy metals and

toxic substances / Bag 45 kg16949 RUR

Polyanionic cellulose, 50-60%

Cellikom JSCKazan (Republic of

Tatarstan)Russia

For petrochemical industry,addition of detergents,

for sizing of warp yarns, thickener inks

50848-127118 RUR

Polyethylene emulsion Oxalen-30, 25% PE wax

Naftan JSCNavopolatsk (Vitsebsk

region)Belarus

Component of finishing agents intextile industry and inleather

industry49500 RUR

Polyethylene wax non-oxidized, grade PV-200


region)Belarus

Used in electronic equipment, cables, paper isolation, polishes

and creams, household chemicals, printing inks, pigments, masterbatches

70000 RUR

Polyethylene wax non-oxidized, grade PV-300


region)Belarus In modeling wax compositions 70000 RUR

Polyethylene wax oxidized, grade PVO-30


region)Belarus

For giving fabrics abrasion resistance and in leather industry

130000 RUR

Polyglycols SIBUR-Neftekhim JSCDzerzhinsk (Nizhny Novgorod region)

RussiaAdditives to lubricants and cutting

fluids63559 RUR

Polymer VRP-3 (based onproduct of alkaline hydrolysis of polyacrylonitrile fibers, neutralized by acetic acid), grade B, 35-55% of dry substance


region)Belarus

For obtaining adhesives, hydrogels, paint formulations, as conditioning additives for mineral

fertilisers

6900000 BYR




tonne, ex. VAT

Preparation K-4 (water-soluble polymer)

Navoiyazot JSC Navoiy Uzbekistan As glue in printing industry 400 USD

Propyleneglycol, 99% Khimprom Ltd Kemerovo Russia EXW / PE canisters, barrels 90000 RUR

Salt OEDFK / 1 oxyethylidendiphosphone acid trisodium salt, pure, 96%



Russia Forperfume industry 211864 RUR

Silicon dioxide precipitated / silica filler Rosil-175, grade A, 90%



Silicon dioxide precipitated / silica filler Rosil-175, grade B, 90%



Silicon dioxide precipitated / silica white BS-100 compacted with calcium chloride, 86%



Silicon dioxide precipitated / silica white BS-100 compacted, 86%



Silicon dioxide precipitated / silica white BS-120 compacted, 87%



Silicon dioxide precipitated / silica white BS-120 uncompacted, 87%



Silicon dioxide precipitated / silica white BS-50, 76%



Silicon dioxide precipitated / silica white U-333, 88%



Silicon dioxide, 30% solution


(Vitsebsk region)Belarus

Binder and stabilizing component of refractory linings in

metallurgical and engineering industries, carrier for various

catalysts

437200 RUR

Silicone fluid PMS-50, PMS-100, PMS-200, PMS-300, PMS-400 / Polymethylsilicone fluid (oil)

Penta-91 Ltd Moscow Russia

Plasticiser for elastomers reagent treatment of fabrics

and leathers, to reduce foaming, without prejudice to the lubricating properties of engine oil, in the production of household chemicals and

cosmetics

127119 RUR

Silicone fluid PMS-500 Polymethylsilicone fluid (oil)

Penta-91 Ltd Moscow RussiaHeat transfer medium, hydraulic, damping and coolant, dielectric

transitions in defoamers135593 RUR

Sodium alkyl benzene sulfonate Sulphonol, grade bleached, 40-45% solution

Zavod imeni Sverdlova Federal

government enterprise


RussiaSurfactant inproduction of

detergents93220 RUR

Sodium alkylbenzene sulphonate (sulphonol), 25%


of Bashkortostan)Russia Surfactants in synthetic detergent 22740 RUR




tonne, ex. VAT

Sodium chloride, 96% Soda JSCSterlitamak (Republic

of Bashkortostan)Russia

Reagent, antiglaze material technical / Big bags

1318 RUR

Sodium chloride, aqueous solution (280 g/l), 50 g/l sodium sulphate, 10 g/l caustic soda

Khimprom Ltd Kemerovo RussiaFor regeneration of ion exchange resins at water treatment plants

3000 RUR / m3

Sodium formiate, 25% solution

Scientific and Industrial Association

Tehnolog JSC


Russia Antifreeze additive in concrete 6780 RUR

Sodium silicate, 19,2-28,8% silicon dioxide


of Bashkortostan)Russia For silicate paints 11815 RUR

Sodium silicate, min 99% of SiO2 + Na2O

Zaporozhye Factory of Welding Fluxes and Glass Products JSC

Zaporizhzhia UkrainePP Big bags 1000 kg / rail-car,

tank-car, tank norms2115 UAH

Substances textile auxiliaries Sorbital S-20 / Product of oxyethylation of sorbitan S



Used for finishing fibers and fabrics

110000 RUR

Substances textile auxiliaries Sorbitan S / Product of esterification of sorbitol and stearic acid



Used for finishing fibers and fabrics

130000 RUR

Tetrabutoxytitanium technical

Promchimperm CJSC Perm Russia

Drum 200 kg, 40 kg / Catalyst inproduction of plasticisers, paints, component in cable

industry

189 RUR / kg

Tetraethoxytitanium, pure Promchimperm CJSC Perm Russia

For illumination optics, deposition of thin films of titanium dioxide,

catalyst inproduction of plasticisers, polymers

3980 RUR / kg

Thiourea (thiocarbamide), 95%

Navoiyazot JSC Navoiy UzbekistanFloated reagent of metals, in

manufacture of mercantans, dyes synthetic resins

9270345 UZS

Tin tetrachloride 5-water (crystalline), pure

Promchimperm CJSC Perm RussiaCoating composition of glass /

Packaging 2 kg, 5 kg750 RUR / kg

Triethanolamin titanat technical

Promchimperm CJSC Perm Russia 249 RUR / kg

Triethylaluminum Tomskneftekhim Ltd Tomsk RussiaUsed for the production of polypropylene, linear polyethylene and HDPE

361017 RUR

Urea in demineralised water, solution of high purity AUS-32, 32%

Grodno Azot JSC Grodno BelarusReductant type NOx for diesel

engines4169954 BYR



1 EUR = 3,8982-3,9159 ТМТ Official exchange rate, according to the Central Bank of Turkmenistan during 1Q 2014




Paints and coatings Prices www.chemmarket. info

Prices for some feedstocks for paintwork production in Russia, Ukraine, Belarus and Uzbekistan as of 1Q, 2014

Product Manufacturer City Country NotesPrice per tonne, excluding VAT

Acrylic acid, 99.5% Acrylate JSCDzerzhinsk (Nizhny Novgorod region)

Russia68644 – 71186

RUR

Acrylic acid, 99% Acrylate JSCDzerzhinsk (Nizhny Novgorod region)

Russia 77119 RUR

Acrylic dispersion Akrilan 121 / Aqueous dispersion of a co-polymer of esters of acrylic and methacrylic acids, 50% solids

Akrilan Ltd Vladimir Russia Without cost of packaging 67373 RUR

Alcohol-ether concentrate, grade ASIBUR-Khimprom


Alcohol-ether concentrate, grade BSIBUR-Khimprom


Butylacrylate, 99.5% Acrylate JSCDzerzhinsk (Nizhny Novgorod region)

Russia 77119 RUR

Calcium phosphate lamellar Kronakril Ltd Yaroslavl RussiaAnticorrosive pigment for

paints water1500 USD

Cellulose dinitrate / Kolloksilin lacquer, anhydrous, grade PSV

Tambov powder factory

Kotovsk (Tambov region)

Russia

For production of lacquers, enamels, primers, mastics, celluloid / corrugated boxes

12-18 kg

191000 RUR

Cellulose dinitrate / Kolloksilin lacquer, dehydrated, grade VV, VNV



Russia

For production of lacquers, enamels, primers, mastics, celluloid / corrugated boxes

12-18 kg

187000 RUR

Cellulose dinitrate / Kolloksilin lacquer, not anhydrous, grade NH



Russia

For the production of lacquers, enamels, primers, mastics, fillings, celluloid / reusable packaging 18-22

kg

223203 RUR

Co-polymer of methacrylic acid and butyl ester of methacrylic acid BMK-5

Experimental Plant of acrylic dispersion Ltd


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U.S. financial system as a determining factor in shale gas exports

It is necessary to remind how the American financial system is organised in order to understand the nature of global hydrocar-bons flows. It should be mentioned that the current monetary and financial system is characterised by the domination of U.S. dol-lar functioning as the main global currency. The crisis of the monetary system, which is only worsening now, turn out a direct conse-quence of the money issuing mechanism of the USA. The Federal Reserve issues money, and the American government amasses more and more debts. The U.S. government takes a decision on debt servicing and discharge of liabilities. State expenditures in the USA grow much faster than revenues, the budget has a chronicle deficit and the national debt consequently increases. This process only continues to accelerate and reminds an ava-lanche. Countries less and less trust in the stability of the U.S. economy and dollar. Now shale gas appears on the scene to come to the rescue.

Two scenarios of LNG exports from the USA

Today there are two scenarios of LNG exports from the USA:

1) LNG is exported on a small scale. The main advantage of this scenario will be achieved not only through a multiplicative effect, but also via creating an image of secur-ing the American dollar and debt liabilities at the expense of a ‘cheap’ shale gas effect, which may influence the entire economy. It is important for meeting export liabilities and creating speculative demand (or on the con-trary - panic) on the market.

If the USA borrows to pay its debts and create an image of solvent before creditor countries, why it cannot do the same with LNG - let’s create an image of an exporter sending two-three tankers to Europe, while using shale gas for our own needs as a source of economic prosperity. One should also understand that according to various expert estimates, low-cost gas increases the market added value of U.S. economy by 2-6 times via related consuming industries (especially

the petrochemical industry). Simply put, this is the mentioned multiplicative effect. Owing to it, America has dethroned China in terms of investment attractiveness worldwide for the first time over more than ten years tak-ing the first place. It is also curious how a significant reduction in gas prices (due to the shale gas revolution) in the United States has led to a decrease in manufacturing costs in America. It came to the point that trans-national companies began to repatriate their capital from the traditional regions of com-modities production in the Southeast Asia back to the USA. Manufacturing output and the whole economy have started to gradu-ally rise. Today America can boast of the lowest unemployment rate over the recent five years. The housing market is recover-ing. The machine-building sector has created additional jobs firstly since 1990. As this takes place, the country is developing its own

A Systemic Analysis of an Economic Policy of Regulating Hydrocarbons Flows Worldwide under the Conditions of the ‘Shale Gas Revolution’

Text by: Zabolotskiy Sergey (Phd in economics)

Institute of Economics and Industrial En-gineering, Siberian Branch of the Russian Academy of Sciences

17 Lavrentyev Ave.,

Novosibirsk, Akademgorodok, 630090

Tel:+7 (383) 330-10-59.

Fax:+7 (383) 330-25-80.

E-mail: [email protected]


Chemistry and economywww.chemmarket. info

low-cost power generation and petrochemi-cal industry.

2) Theoretically, we can assume that America will export LNG on a large scale. This contradicts sound economic logic but still can take place in exceptional condi-tions, if, for instance, U.S. gas exports leads to rapid depletion of shale gas resources followed by a regular military intervention against a hydrocarbons producing country in the Middle East or South America. This sce-nario is advantageous in terms of promoting an image of prosperity of the U.S. economy, which has entered global exchange in hydro-carbons. This may also support the American financial pyramid (Ponzi scheme) confirming the ‘reality’ of some part of the U.S. economy, which is not based upon speculative opera-tions. In this case, one can expect that ‘tradi-tional’ suppliers of hydrocarbons, i.e. OPEC countries and other gas suppliers (Norway, Algeria, Nigeria, Qatar, etc.) will mount stiff resistance. Thus, the USA could certainly raise up business rivals among the traditional exporters. In other words, this scenario is not about profits from gas exports, which will be negligible owing to ‘eating away’ added value during gas liquefaction, transportation and dilution but rather about creating a positive image. In doing so, America will inevitably lose the main driver of its economy in years to come, because ‘profitable’ gas reserves with low production costs are pretty small, as official forecasts say. Preserving hydrocar-bons reserves for future use, given that they could be bought for uncovered dollars (debt liabilities), explains why these scenarios are mutually exclusive.

Introduction

Many global processes have to be described in terms of hardly formalized and tangible factors. Today, global economic players are conventionally denoted as finan-cial and industrial groups that cannot always be related to borders of certain countries. However, this is a theme for a separate

article. That is why the given article uses conventional terms for world’s economic centres: the USA, the EU, Russia, etc.

The U.S. shale gas (and oil) production has led to a number of consequences includ-ing those at the global hydrocarbons market. Various studies forecasts that additional vol-umes of gas produced from shale rock can be exported from the USA approximately starting with 2016 competing with traditional gas suppliers. This article shows why this scenario will be either scarcely probable or hardly influence the world’s economy if realised.

We should adopt a systemic approach so as to fully explore the topic of the present arti-cle. It is to be also mentioned that no material in some or other way relating to conspiracy theories is used to prove basic principles of the present article. All the materials used are taken from official sources. One of theories that subsequently became a legislative act envisaging temporary replacement of more than 75% of oil imports from the Middle East by 2025 is assumed as a basis for the article .

It should be noted once again that the mod-ern world stands in desperate need of gas, oil, and other hydrocarbon resources. That is why we cannot imagine the existence of our civi-lization without ever growing consumption of these raw materials. And when difficulties with extraction of readily available hydro-carbons appear, this affects the entire global economy. The most difficult challenges mankind faces now are introducing innova-tive technology for developing problematic and difficult reserves, striking a balance between hydrocarbons producing countries and consuming nations and optimizing gas consumption.

Harry Oppenheimer* noted in his day: “People buy diamonds out of vanity. They buy gold because they are too stupid to think of any other monetary system which will work”. The international system of hydro-carbons supply and maintaining a supply / demand balance are the most effective busi-ness direction based on technological and

commercial relations, economic and, conse-quently, political interests. The vast major-ity of technological systems in the modern industry as well as energetics and transport are based on using hydrocarbons. Amidst the absence of reliable and stable suppliers of raw materials, ways of their shipments to consumers, there may occur serious failures in global financial and economic processes.

Until hydrocarbon resources and reserves are not developed, their actual value increases in a long-term prospect (due to awareness of limits of their us). But as soon as they have been produced and sold, they turn into finan-cial flows. These are sources of new invest-ments in fixed assets and the opportunity to purchase the latest technologies for various tangible and intangible assets.

In addition, they are a source of financial receipts or cheap money (in case of their inefficient use). In order to get a clear idea of hydrocarbon flow, one should realise the commercial nature of money, regard-less of the currency of the country under consideration.

Under these conditions, the task of effi-cient development of one of the key sectors of Russia’s economy - oil and gas sector – is not increasing exports of raw materials at any price but transforming money income into capital, i. e. self-expanding value, due to efficient investments in the development of a raw material base and further processing hydrocarbons into semi-finished products, gradual creation of assets and products, for example, materials with relatively high added value.

It is to be stressed that money is the most universal but not the best mechanism of exchange and one of the main instruments for influencing the world trade. In global condi-tions, money tends to ‘flow’ from one system to another. Money ‘inflate’ the economy and makes it grow. Levels and rates of economic development depend on how money is used by recipients.

In this regard, it is important to understand that this is not a group of hydrocarbons



exporters have got hooked on oil and gas needle but a group of countries-importers. Such economic methods as an “infusion” of excessive amounts of hydrocarbons into the market may not have a significant impact on other players, as the exporters have been long using a mechanism of tackling such situations.

In other words, these are one-time transac-tions, which may be resisted by hydrocarbons supplying countries via reducing of excessive amounts of gas supplying to the market. In case of a negative scenario, ‘releasing’ some insignificant volumes of hydrocarbons are used for domestic consumption, while gas and oil are processed in the country-producer.

Thus, all fluctuations in hydrocarbons sup-plies can be easily regulated by the consum-ing countries. The dependence of the sup-plying countries on financial support is less than that of the consuming countries upon hydrocarbons. Continuous flows of hydrocar-bons from the suppliers to the consumers will guarantee that in future hydrocarbons will not be used only for domestic consumption in the exporting countries but will still be sup-plied to the importers. Otherwise, the export-ing countries can prepare for consuming the released volumes of hydrocarbons meant for export. In other words, it is not reasonable to

stop buying hydrocarbons, as exporters will still be able to sell hydrocarbons in the future. At the same time, they could be bought for ‘mottled slips of paper’ – dollars, euros, yens or their electronic variant. The question is not how much supplying countries will get for their hydrocarbons, although it is impor-tant, but how fast the economy of the sup-plier and that of the consumer will grow and who will faster create more high-tech assets, which will utilise these hydrocarbons more effectively. These are questions of systemic dynamics, in which the speed of technologi-cal development and a real (not hydrocarbon) economy decisively influence the flow of capital from one country to another. In par-ticular, oil price is high enough for Russia, so it is not about meeting the basic demand of any economic system, but rather about rationality of investments and controlling additional financial flows from creating high added value products.

‘Shale gas revolution’

Shale gas revolution is a way to hold finan-cial flows to the Middle East and other oil and gas producing regions of the world. Not long ago, America developed a theory of limiting purchasing hydrocarbons (oil) from countries

of the above-mentioned region at the expense of its own gas production. Gas is proposed to be used as a substitute for oil products.

If we make a brief historical insight, we can see that the United States faced the same problems in 2013 as earlier before. The country faced the same energy issues and the difference was only in other fuel sources. At one time, Americans used whale oil, but were always looking for a cheaper fuel.

Coal became an alternative to whale oil followed by crude oil, and eventually – shale gas. In the mid-70s, more than 50% of oil consumed by Americans at the domestic market was imported from the Middle East. But the United States were searching for a cleaner and better fuel, which was to be produced locally. First, they pursued a policy of cultivation of crops for biofuels in Latin America and built windmills and solar pan-els. In the end, they invented what they are having now. Americans constantly searched through all possible sources of fuel, conduct-ing a systematic analysis of their effective-ness at each time point and analysing their performance indicators over time. So, it is not surprising that that country was the first to produce shale gas.

Going over to the crux of the matter, it should be stressed that many American experts believe that low cost shale gas could be a temporary substitute for oil products for motor, railway and sea transport, and could be also used as a raw material for the petrochemical industry and as an instrument for reducing financial flows from the U.S. to the Middle East. The USA transferred USD 1 trillion to the Middle East from 2001 to 2010 and a total of as much as USD 7 trillion from 1976 to 2010 provided that expenditures on military purposes in the region are also taken account. This is the biggest re-distribution of wealth from one group to another over the whole history of mankind. Over the next 10 years it was planned to transfer USD 2.2-2.6 trillion additionally if shale gas is excluded. Figure 1 shows the main financial flows between regions and countries*.

Source: BP Statistical Review of World Energy 2013

Figure 1. Financial flows from oil importing countries to the exporters in 2012, USD billion dollars



The United States consumes about 11m barrels daily, which makes up 19.1% of global consumption. In this connection, we can emphasise that demand for hydrocarbons will double only from 2020 to 2040. About 70% is used for transport purposes.

Thus, America is implementing an eco-nomic strategy of ‘spreading’ financial flows across the countries-exporters of hydrocar-bons so as not to strengthen some particular nation or economic centre / region. The recent cancellation of economic sanctions against Iran and its involving in global economic ties only proves this fact. Save for isolated cases of transferring shale gas technologies to tra-ditional oil and gas producing regions, the said technologies have been transferred only to the consuming regions in order to weaken their dependence from the suppliers. In 2012-2013, shale gas production technologies were licensed and tested in China and European countries, despite the fact that China became a powerful economic center competing with the United States and getting stronger and stronger year in year out. Thus, with a higher

degree of certainty, we can assume that fears of increasing financial flows to Russia from China and Europe, to the Middle East from the U.S., Europe and China turned out greater due to increased hydrocarbons exports from the first ones. However, problematic geologi-cal conditions of occurrences of gas in the main hydrocarbons consuming regions and less extravagant ways of purchasing natural gas from other countries testify to the fact that there will be no breakthrough in shale gas production in China and Europe in the nearest future. It is more reasonable for these regions to acquire natural gas via pipelines and in a liquefied form keeping shale gas reserves for future use. The U.S. strategy is obvious - making hydrocarbons cheaper worldwide. But this strategy cannot be real-ised in full since the countries-suppliers of hydrocarbons could agree on a reduction in production to support an acceptable level of profitability. As for the European region, it will consume natural gas from Russia as an alternative to LNG supplied from other coun-tries including those from the Middle East.

Still, America is most likely to export LNG on a modest scale and not for long. But if the United States decides to make this step (insignificant LNG exports for a short time), the ‘traditional’ suppliers of hydrocarbons can agree on cutting production to maintain their profits at an acceptable level.

An important economic driver

Shale gas is an important driver of the U.S. economy. Despite a global slowdown in growth of demand for pipeline and lique-fied natural gas in recent years, that country displayed an opposite trend in recent years. Figure 2 clearly shows convergence of sup-ply and demand curves.

In 2009-2012 (post-crisis period), there was a slowdown in growth rates of natural gas consumption in all the regions of the world except for the United States. Partly, it could be related to increasing production of cheap shale gas, which pushed an increase in industrial production including in power generation.

Figure 2. U.S. natural gas production and consumption in 1970–2012

Source: BP Statistical Review of World Energy 2013.



In 2012, the United States were the world leader in terms of absolute growth of gas consumption. We can make a cautious con-clusion: low prices for natural gas pushed the country’s economy and gas consumption proper. This is one of the oblique proofs that the USA will not probably export LPG from shale deposits. Certainly, there have been sporadic cases of exporting small LPG volumes from one of the oldest plants of its kind Kenai LNG (Alaska) to Japan starting in 1969.

However, the capacity of the plant is only 1,4m tonnes, and it still remains operational only in order to avoid staying idle and sav-ing jobs. Certainly, America has invested a lot of money in LNG terminals. Therefore their lying idle may create another ‘rust belt’. But using these production facilities to cre-ate a temporary glut of hydrocarbons at some world markets so as to reduce prices may have a short-term effect and, consequently, will not succeed and be implemented in the maximum volume claimed.

Hydrocarbons can be purchased via addi-tional issuing of USD dollars, but using domestic reserves of hydrocarbons produced from hard-to-reach oil and gas formations for economic expansion appears illogical. On the opposite, in the nearest future we should expect for the United States to start import-ing LNG from Qatar and other countries, as a result of consumption growth. This may be

an obvious chance for Russia to occupy its niche in the LNG market in the Asia-Pacific region.

In addition, it is expected that total switch-ing of boiler stations from coal to natural gas in China by 2018 and the accident at the nuclear power plant in Japan (leader in terms of LNG consumption) will make these coun-tries key drivers of natural gas consumption in the nearest future. In these conditions, taking into consideration opinions of experts that up to 85% of Russian reserves of hydrocarbons are off-shore reserves, Russia will be able to provide the importing countries with gas for many years to come. It would be much more reasonable for the USA to increase the con-sumption of gas by resuming purchases from Qatar followed by growing production of high-tech products and an increase in exports of value added products, while maintaining its reserves of shale gas for the future when other countries will run out of them. America would rather concentrate on producing high-tech products to “exchange” them for hydro-carbons at international markets instead of buying them in debt.

While China is developing fast, Americans should further exploit a niche for high-quality products. Heavy-duty cars and trucks, state-of-the-art electronics, high-tech aircraft and spacecraft and weapons are those directions that can be developed without competing in low-range segments occupied by Chinese,

Japanese and other Asian products as well as by Middle Eastern countries.

Prospects for optimising a resource base for gas chemical synthesis in Russia

The power intensity of the Russian economy is twice as much as that of Japan and leading Western European countries. Simultaneously, Russia is lagging behind the mentioned regions in terms of GDP per capita. High electric intensity of the Russian economy is associated with its structure. The manufacturing industry prevails in terms of power consumption - its share is 44,5% (without power generation), and in recent years it has been growing. In other words, in the USSR we used to sell products with high added value, and low production costs were based on ‘cheap’ natural gas. So why should we go away from such an economy? It is far more reasonable to develop it.

Supplying methanol, a basic semi-finished product of gas chemical synthesis used for further conversion to a number of chemical substances (including methanol-to-olefins technology) is very promising in this regard. Supplies of ‘pseudo-gas’ in the form of nitro-gen fertilisers should be developed as well.

Methanol can be processed into dimethyl ester and used in energetics. And it can become a major factor in the development of the fuel market in the future (lower per-meability coefficient and safety). In China, dimethyl ether is widely used as a fuel. In the future, we should expect that countries with poor environment will start purchasing cleaner fuels (such as dimethyl ether). But do not forget that production of cleaner fuels is also harmful to the environment. So, it is rational to move it to remote and sparsely populated areas.

Russia may take a larger share of metha-nol and fertilisers at the world market. This requires ‘cheap gas’. According to Russian experts, by 2015 in China a deficit of methanol can reach 5.0-9.6m tonnes (14-

Table 1. Global exports / imports of methanol, thousand tonnes

Region

Net imports Net exports

2006 2015 Average growth

rates, %2006 2015

Average growth

rates, %

Total 12071 25532 – 12071 25558 –

Europe 4967 7983 1,69 – – –

North East Asia

7104 17549 10,6 – – –

Russia – – – 1567 5327 3,89

Middle East

– – – 4 979 13465 1,00

Other – – – 5525 6766 10,6

Source: CMAI



20 % of domestic demand). In the coming years, China will commission several major production units for methanol, which may reduce the deficit. Its size will probably be determined by a number of production fac-tors, primarily, by feedstock provision of the Chinese methanol sector.

As regards outlooks for methanol sales, it is of interest to look at data on the global methanol market presented by CMAI (Table 1).

Any process of re-industrialization and increasing competitiveness of the national economy can be achieved by using the ‘Soviet model’, which was oriented towards low-cost natural gas. Any production plant based upon cheaper gas will get an advantage at the international markets. In 2013 domestic gas prices in Russia caught up with the U.S. ones fixed at about USD 120 per 1,000 m3 , without taking into consideration seasonality and about a tenfold fluctuation in prices due to abnormally low temperatures during win-ter. Today Russia still needs to find ‘cheap’ natural gas to maintain the competitiveness of its economy.

A source of cheap gas for Russia

Under the current conditions, these are not the countries-exporters of hydrocar-bons that ‘have oil / gas addiction’ but, on the contrary, - a group of the countries-importers. The exporters could use min-eral resources for developing and keeping economy afloat, but the importers have to ‘squeeze’ the last drops of oil and gas out of the earth, which still remain in shales (save for such exotic hydrocarbons sources as the Arctic shelf and hydrates). They do it in order to maintain the competitive strength of their economies against the background of the fast-growing global eco-nomic centres.

Hydrocarbons are the second most impor-tant factor for any economy after human capital assets. Today to maintain exports level, there are no options left except for

deep-hole drilling or developing off-shore gas. In doing so, the most promising way of improving efficiency of the Russian indus-trial sector should be replacing obsolete gas turbines with the new ones, i.e. enhancing the coefficient of efficiency of heat power plants . There is no way of refusing from the devel-opment of the Arctic shelf, since it is not clear whether warming in the north is temporary or whether there will be climatic cooling again. At the moment, climatic conditions are quite favourable for developing the Arctic shelf. Therefore this period of climatic changes should be used to the utmost to derive sub-stantial benefits from warming. In this regard, to enhance the efficiency of the economy at the expense of saving additional volumes of ‘cheap’ gas, technologically obsolete turbines at heat power plants should be replaced much more intensively, because more than half of gas is just burned in vain by reason of low technology. The proposed variant of replac-ing the turbines, however, is not regarded seriously due to the well-known incident at the platform ‘Prirazlomnaya’ in 2013 (the Prirazlomnaya platform in the Arctic was the focus of a high profile Greenpeace pro-test in September). Nevertheless, the idea of

turbines replacement actively promoted by ‘Greenpeace’ in 2006 should be paid scrupu-lous attention to. This idea is unfairly forgot-ten, though it is becoming of urgency under the current conditions owing to the success of the ‘Prirazlomnaya’, the ‘shale revolution’ and the necessity to keep domestic gas pro-cess at an acceptable level. At the same time, an option of replacing gas turbines at heat power plants to the detritment of investments that could be made in the Arctic shelf devel-opment should be entirely excluded. Gas consumption saving will exert a profound multiplicative effect upon the economy. The main difficulty consists in simply making private owners modernise heat and power plants. This may be some legislative measure such as upgrading heat and power plants via a partnership between state and private own-ers by a certain term. However, one should be completely aware of necessity to enforce modernization. According to the most con-servative estimates, aggregate capacity of heat and power stations can increase 1.5-1.7 times at the very least at the cost of increas-ing their degree of efficiency. Therefore, additional volumes of natural gas could be used for other purposes. A strong stimulus

Figure 3. A diagram of Russian gas consumption optimisation



for the development of the new economy in Russia can be provided by optimizing gas consumption in accord with a diagram shown in Figure 3.

Simultaneously, it is of big interest to consider the key advantages and shortages of using natural gas a fuel (Table 2).

It is to be noted that Siberian scientists are carrying out research into mechanisms and a system of optimizing investments in the development of new gas fields and heat and power plant modernisation for from using saved gas.

Conclusions

Thus, comparatively recently, a theory of restricting hydrocarbons purchases from the Middle East at the expense of its own production of gas and replacement of oil products with gas in sea, railway and motorа transport evolved in America. Secondly, growth of shale gas production in that coun-try contributed to growth of gas consumption and to increased efficiency of the economy. In 2012, gas production growth rates in the USA noticeably reduced. In 2013, monthly production of shale hydrocarbons underwent

significant fluctuations. In years to come, All in all, shale gas production is forecast to decline, according to EIA .

Thirdly, the accident and subsequent failures at nuclear power stations in Japan, which takes the lead in LPG consumption, as well as total switching of coal boiler rooms to natural gas in China by 2018 make the mentioned countries the key drivers of global gas demand in the nearest future. Large-scale LPG exports from the USA should not be expected; on the contrary, that country may be a potential destination for gas streams in the long-term prospect.

Finally, to improve the efficiency of the Russian economy, it is necessary to reduce its power intensity, thus releasing additional gas volumes (at the cost of mod-ernisation and replacement of turbines) of heat and power stations for the sake of gas chemical synthesis and / or generation of ‘cheap’ power. At the same time, to develop hard-to-get-to resources at the Arctic shelf is also a basis for Russia’s economic advancement. The Arctic shelf accounts for nearly 80% of hydrocarbons reserves in the country. Therefore, developing them is an inevitable process. Also, the main

task is to facilitate HPP modernisation at the level of legislation to release ‘cheap’ gas for providing a new stimulus for the economy. It is necessary to upgrade heat and power stations in Russia at a growing rate using a mechanism of state and private partnership along with the development of industry on the basis of business clusters. There should be created an all-Russian information and analytical system on the basis of systemic-dynamic modelling so as to optimise investments in the shelf and HPP modernisation.

LNG exports from the USA will probably be insignificant and short-term. The opposite, hardly probable scenario, if the USA did take a step in that direction (large LNG exports for a short period of time), means that the ‘tradi-onal’ countries-exporters of hydrocarbons could agree on reducing production with the purpose of maintaining their profitability at a suitable level. This is not critical to Russia, since the country will direct its hydrocarbon flows to Asia, of which European countries are well aware. Europeans need Russia in order to put pressure on Qatar and the other countries-suppliers. Pipeline supply is the stability, which Europeans have no intention to lose.

Table 2. Advantages and disadvantages of replacement with gas

Target area Advantage of replacement with gas Disadvantage of replacement with gas

(complexity of replacement)

Internal combustion engines in passenger cars, trucks, public motor transport and sea transport

Bigger fuel tank capacity, longer mileage with the same fuel consumption, high performance

engines, low operating costs, lower CO2 emissions

High permeability of natural gas, hazards related to high pressure while storing

Out-of-date turbines at HPP

Saving gas (smaller consumption of gas in current time – direct effect from gas sales by large Russian companies) or releasing ‘cheap’

gas at the expense of high-tech turbines

Complexity of modernisation process – a large number of HPP owners

* Average oil price is taken for calculation. Aggregated calculation is made on the basis of prices for the following brands of oil : Urals, REBCO, ESPO,

Siberian Light, Brent, Dubai Crude, Light Sweet, WTI.1 Subsidizing Oil Shale: Tracing Federal Support for Oil Shale Development in the United States, Taxpayers for Common Sense, November 29, 2012, link: http://www.taxpayer.net/images/uploads/downloads/OilShale-v7.pdf2 Henderson D., М. Belova M., LNG: Made in USA. Skolkovo energetic centre. hyperlink: http://energy.skolkovo.ru/upload/medialibrary/07c/SEneC_LNG_Made_in_USA.pdf4 Russian gas export price in 2013 averaged USD 380 /1,000 m3. U.S. price – USD 132 /1,000 m3. Company news http://neftegaz.ru/news/view/1181205 Wearing of equipment – a systemic problem of the entire power industry // Power market. – 2011. – № 3(39) May–June 2011. hyperlink:http://market.elec.ru/nomer/36/iznos-oborudovaniya-sistemnaya-problema-vsej-elekt/7 Zabolotsky S.A. Outlooks for development of LNG supplies: changes in the global markets // Neftegaz.ru. – 2013. – № 10. – p. 21–26 (http://lib.ieie.nsc.ru/docs/NeftegazRU_2013_10.pdf)

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Michitaka Sawada, President and CEO, Japan

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Chemistry and business www.chemmarket. info

EuroChem Mineral and Chemical Company (“EuroChem”) announced consoli-dated full year 2013 revenues according to IFRS of RUR 176.9bn (USD 5.6bn), which represented a 6% increase on revenues of RUR 166.5bn (USD5.4bn) in 2012. Earnings before interest, taxes, depreciation, and amortisation (EBITDA) amounted to RUR 43.0bn (USD 1.3bn), as compared to RUR 49.2bn (USD 1.6bn) in the previous year.

Full year fertiliser sales volumes for the company’s nitrogen and phosphate seg-ments, excluding sales of mining co-products, increased 788 thousand metric tons (KMT) or

by 8% to 10.6m metric tons (MMT) as com-pared to 2012 sales volumes (or up less than 1% on a like-for-like basis, excluding EuroChem Antwerpen and EuroChem Agro). Mining raw material sales volumes, which include iron ore and baddeleyite, added over half am tonnes and grew to 5.9 MMT, which represented an 11% increase on the previous year.

CEO Dmitry Strezhnev commented: “Despite the growth in fertiliser demand falling short of market expectations, we continued to challenge ourselves to increase volumes and gain market share. As high-lighted by our results, our unique asset base

is well positioned to drive and support robust cash flow generation across the business cycle. The ensuing value creation is set to be boosted by our targeted strategic initiatives, such as in potash, nitrogen and phosphates, which will serve to further entrench our resilience.”

2013 Market Conditions

The fertiliser markets had a rather tumultu-ous year. While the year started off slowly on account of adverse weather in some key mar-kets, conditions had materially improved by

EuroChem Reports IFRS Financial Information for 2013

EuroChem Antwerpen’s premises


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late spring. Farmers quickly made up for the lost time as favourable soft commodity prices provided the incentive to increase yield and expand acreage. Despite the return of healthy demand levels for all three nutrients, the first quarter’s inventory build-up limited any significant pricing appreciation. Urea prices proved the most vulnerable on account of record urea exports from China where ample coal supply and lower prices boosted the global competitiveness of local producers. On the demand side, India’s currency devalu-ation coupled with what has been described as an archaic subsidy system left one of the world’s largest fertiliser importers incapaci-tated for the better part of the year.

In a positive for both producers and cus-tomers, raw material price dynamics mirrored the softer market conditions. Over the course of the year, gradually weakening ammonia, sulphur and phosphate rock prices helped alleviate some of the margin pressure on the producer side. Prilled urea (FOB Yuzhny) averaged USD 341/tonne in 2013, down 16% from its 2012 average of USD 408/tonne. Ammonium nitrate (AN) (FOB Black Sea) performed slightly better and finished 2013 with an average of USD 288, 5% below its average for the previous year.

While phosphate prices received some support from the growth in planted acre-age in Latin America, the market remained otherwise fragile given the limited buying activity from India. Average MAP and DAP (FOB Baltic Sea) prices for 2013 were USD 454 and USD 457USD/tonne respectively, trailing their 2012 average prices by 18% and 17% respectively.

Midway through the year, unexpected strategic repositioning by Uralkali wreaked chaos over the potash landscape. Citing lost market share and declining sales volumes, the Russian potash producer’s abrupt exit from the BPC marketing vehicle, which it formed with neighbour Belaruskali, brought the mar-ket to a standstill. Potash prices reacted in a knee-jerk fashion and went on to shed over 25% by year end. While many potash expan-

sion projects were reassessed in the wake of this market reshuffling, EuroChem reiterated its commitment to the “third nutrient” with work continuing at both its greenfield potash projects in Russia. At an average of USD 352/tonne in 2013 MOP (FOB Baltic Sea) contract prices fell 17% YOY as compared to an average of USD 424/tonne in 2012. The spot price premium to contract prices tightened as buyers held out given the mar-ket uncertainty. MOP (FOB Baltic Sea) spot prices ended 2013 with an average USD 379/tonne, 19% behind their 2012 average of USD 467/tonne. Spot prices for MOP on the Baltics finished the year at around USD 290/tonne, or ca. 40% below their late December 2012 levels.

Buoyed by stronger-than-expected demand from China, iron ore (63.5%Fe, China CFR) averaged USD 136/tonne for the year, a 3% increase versus its 2012 average.

BUSINESS SEGMENTS

Nitrogen segment

The company’s 2013 nitrogen segment sales volumes continued to benefit from the added depth to its fertiliser production chain. Full year volumes increased 11% and rose to 8,217 KMT, which corresponded to an additional 838 KMT of product as compared to 2012. While the year proved challenging

for urea and AN trading, the breadth and flexibility of the company’s production and distribution assets alleviated some of the pressure. The consolidation of EuroChem Antwerpen and EuroChem Agro yielded significant gains for the company’s more advanced crop nutrition products. Sales in NPK, UAN, and granulated AN increased a combined 978 KMT over the previous year, more than compensating the slightly lower urea and AN sales volumes, which slipped 7% and 11% YOY respectively. CAN sales volumes were also strong, increasing 24% to 943 KMT as compared to 759 KMT in 2012.

The company’s nitrogen revenues for the 12 months ended 31 December 2013 climbed to a record high of RUR 100.1bn, which rep-resented an 8% increase on what was a strong 2012 performance. Average prices for nitro-gen products nevertheless reflected the chal-lenging market backdrop and pulled nitrogen segment EBITDA down 14% to RUR 26.2bn as compared to RUR 30.6bn in 2012.

Sales to Europe, which represented 26% of total nitrogen sales in 2012, increased 29% and accounted for 31% of the Group’s nitrogen sales in 2013. The increase in sales to Europe was primarily brought on by the expansion of the company’s distribution net-work and asset base in Western Europe cou-pled with challenging conditions on the other side of the Atlantic. The company’s sales to Russia increased 14% and accounted for 23%

View of Severneft-Urengoy



of segment sales (2012: 22%).Urea’s relative weakness versus other nitrogen products was especially felt in the Americas. Sales to Latin America and North America decreased 31% and 18% respectively. Together these two regions accounted for 23% of sales in 2013 (2012: 32%).

At the company’s upstream nitrogen operations, its Severneft-Urengoy (SNU) natural gas subsidiary provided RUR 5.1bn and RUR 1.5bn to the Group’s revenues and EBITDA, respectively. Natural gas sales volumes increased 27% YOY to reach 830m m3 while gas condensate sales volumes expanded 26% to 141 KMT as compared to 2012. The natural gas volumes were sold to Novomoskovskiy Azot at regulated prices less a 5% discount.

For the year, the company’s Novomoskovskiy Azot and Nevinnomysskiy Azot ammonia facilities paid average natural gas prices of RUR 3,966 and RUR 4,120 per 1,000m3 respectively (c. USD 3.87 and USD 4.03/mmBtu), as compared to average prices of RUR 3,432 and RUR 3,594 per 1,000m3 respectively (c. USD 3.43 and 3.60/mmBtu) for the 12 months ended 31 December 2012. Two natural gas price increases were implemented in 2013 in Russia. An increase of 15% took effect from July 1st followed

by a 2-3% raise from October 1st. No price increases have been announced for 2014.

Phosphate segment

Total sales volumes for the phosphate seg-ment, excluding raw material mining opera-tions, slipped 2% or 50 KMT to 2,405 KMT in 2013, as compared to last year. MAP/DAP sales remained practically flat with a mod-est 13 KMT YOY increase while NP sales finished the year 53 KMT below their 2012 levels. Iron ore demand remained resilient throughout the year. Sales of the company’s apatite-mining co-product finished the year up 11% to 5,858 KMT as compared to 2012.

The strong iron ore backdrop lent support to the company’s phosphate segment revenues for the January to December 2013 period and limited the effects of the year’s lacklustre MAP/DAP showing. Full year revenues for the com-pany’s phosphate segment amounted to RUR 58.3bn, representing a 4% decline on 2012 segment revenues of RUR 60.8bn. Phosphate segment EBITDA had a more pronounced decline, pulled down by the lower average realised prices for phosphate fertiliser products, particularly MAP/DAP, and finished the year at RUR 13.9bn, 15% below the RUR 16.2bn recorded a year earlier.

The company’s mining operations miti-gated the weakness in phosphate-based ferti-lisers as healthy demand from China carried average iron ore prices 3% higher YOY. Iron ore and baddeleyite, which are the co-products of apatite mining operations at the company’s Kovdorskiy GOK mine, together generated 38% and 74% of phosphate seg-ment revenues and EBITDA, respectively, as compared to 31% and 51% in 2012.

The sales geography of the company’s phosphate segment reflected the contribu-tion of mining co-products to the segment’s performance. The share of revenue from Asia increased three percentage points as com-pared to 2012 and accounted for 30% of total segment sales. Higher feed phosphate sales drove gains in Europe. As in 2012, it was the company’s second largest phosphate market and represented 29% of 2013 sales, a three percentage point increase on last year. Sales to Russia declined six percentage points on lower MAP/DAP prices and accounted for 18% of sales in 2013.

In late October 2013 the companyan-nounced the launch of drilling and blasting operations at the company’s phosphate rock mining project in Kazakhstan. Most of the major equipment items required to build the initial phase have been purchased, includ-ing but not limited to excavators, dozers, haul trucks, crushers, as well as screening, conveying and loading facilities. First pro-duction is expected to come on stream in the fourth quarter of 2014. With its targeted ini-tial production capacity of around 640 KMT of phosphate ore per year, the company’s Kazakh mining project has been an important part of the company’s upstream raw material strategy.

Potash segment

Eurochem VolgaKaliy (Gremyachinskoe deposit, Volgograd region)

With the cage shaft bottom cleared of water and debris, the companyresumed sink-

General view of Fosforit (Kingisepp, Leningrad region), a member of Eurochem chemical company



ing in the fourth quarter and had progressed to a depth of -148 meters as of 31 January. As previously announced, the restart of sink-ing was delayed by several months. Once the shaft was cleared, detailed surveying revealed that corrections to the shaft liner were required. These issues were inherited from the company’s initial contractor for the project and included the need to remove and replace eleven tubing rings and the concrete backing.

Work also continued on schedule at the skip shaft #1 where the freeze wall was completed in December. Sinking operations resumed after extensive testing of the water and pressure below the bottom concrete plug. The plug was then removed and sinking operations resumed from -572 meters. As of 31 January, the skip shaft #1 had reached a depth of -601 meters out of its planned -1,147 meters.

The freeze wall for the skip shaft #2 was further developed and had achieved its des-ignated thickness at the time of this release. Sinking efforts on the company’s phase 2 skip shaft are currently scheduled to start later this month.

On the surface, the companysaw good progress on the construction of the main process beneficiation building, warehous-ing facilities, and loading and shipping facilities. The main electrical substation is essentially complete and undergoing rigorous commissioning checks prior to energising.]

EuroChem Usolskiy Potash (Verkhne-kamskoe deposit, Perm region)

The companysuccessfully completed cage shaft sinking operations in October 2013 and expect to wrap up skip shaft sinking efforts within the next quarter. The abandonment of the site’s two freeze walls, which were designed, installed, and oper-ated by Thyssen Schachtbau is underway, a program also contracted with the German mining specialists.

As of 31 January, underground operations at the Usolskiy skip shaft were down to 509 meters with only 37 meters left to sink before the shaft’s planned depth. The companyalso made progress on other excavations in this shaft such as openings for the loading bins and pockets.

Above ground, the company’s teams were engaged in the construction of the tailings pond and railroads. The landscape of the site further evolved with the erecting of the foun-dations for various buildings including the administration building, mine rescue build-ing and permanent canteen.

For the January to December 2013 period, total capital expenditure at both VolgaKaliy and Usolskiy amounted to RUR 12.4bn, bringing the aggregate total to RUR 57bn since the start of the company’s greenfield potash developments.

Distribution segment

The company’s distribution segment com-prises the sale of fertilisers and services via a number of retailers located within the CIS, specifically in Russia, Ukraine and Belarus. The strategy to provide its clients with “yields, not just fertilisers” is there to support its customers improve yields through better crop nutrient balance. In 2013, the com-pany’s distribution segment realised sales of RUR 17.0bn and generated EBITDA of RUR 683m.

FINANCIAL

Income statement

Consolidated revenues for the twelve months ended 31 December 2013 grew 6% to RUR 176.9bn (USD 5.6bn). The additional 838 KMT in nitrogen sales volumes coupled with an 11% increase in iron ore sales vol-umes helped alleviate the pricing erosion in phosphates and drive the YOY revenue expansion. Excluding EuroChem Antwerpen and EuroChem Agro, consolidated from Q2

and Q3 2012, respectively, the company’s revenues and EBITDA for 2013 amounted to RUR 135.0bn and RUR 39.2bn respectively.

For the twelve months ended December 2013, the company’s total cost of sales dis-played a 15% increase over the previous year and amounted to RUR 112.8bn. The increase in costs outpaced the 6% revenue growth as average costs and tariffs for key raw mate-rials such as natural gas, phosphate rock, ammonia, and energy moved slightly higher than in the previous year. In line with the growth in production volumes, group costs for materials and components used or resold increased from RUR 64.6bn in 2012 to RUR 70.1 bn in 2013. However, their share within the Group’s costs of sales structure decreased four percentage points to 62%.

Within cost of sales, labour costs, which include social fund contributions, increased 11% in 2013 and amounted to RUR 10.9bn. Most of the uptick in labour costs was driven by a salary indexation in January 2013 com-bined with an increase in personnel brought on by the integration of assets acquired in the previous year. As in 2012, labour costs comprised 10% of the Group’s total costs of sales in 2013.

Despite the considerable increase in pro-duction volumes, the share of energy costs within the company’s cost structure remained flat at 7%. Although the companyregistered a 14% YOY increase in energy costs following the upward revision to tariffs in the Russian power generation, the company’s efficiency upgrade program yielded substantial savings. Particularly, in addition to increasing internal power generation capacity at Phosphorit, the replacement of obsolete catalysts at Novomoskovskiy Azot provided RUR 45m in energy savings in 2013.

Total distribution costs ticked up 8% to RUR 25.3bn as compared to RUR 23.3bn for the same period in 2012. Within S&D costs, transportation expenses registered a slight 3% growth to RUR 18.6bn (2012: RUR 18.1bn). Despite increasing YOY, transporta-tion costs comprised 74% of total distribution



expenses in 2013, down from 78% a year earlier. While lower maritime freight rates provided a 14% reduction in transportation costs, the savings were offset by an increase in rail shipments of iron ore concentrate to Zabaikalsk (Chinese border).

General and administrative (G&A) expenses for the Group increased 20% from RUR 5.6bn in 2012 to RUR 6.7bn in 2013. Accounting for 47% of G&A expenses, labour costs increased 16% over the same period. Total staff costs, including social expenses, grew to RUR 16.6bn, up15% from RUR 14.4bn a year ago. As highlighted earlier, the growth in staff expenses was primarily linked to recent acquisitions and organic growth initiatives. Some of the key ongoing projects of 2013 were the develop-ment of phosphate rock mining operations in Kazakhstan, the launch of the company’s railcar depot to service the Group’s 6,500+ rolling stock, and its ambitious VolgaKaliy and Usolskiy potash projects in Russia.

For the full year 2013 the companyrecog-nised other operating expenses of RUR 425m versus other operating income of RUR 371m in 2012. The main items behind other operat-ing expenses for the period were sponsorship expenses of RUR 839m (2012: RUR 516m) and foreign exchange gains of RUR 393m (2012: losses of RUR 263m). The main sponsorship expenses included a new sports facility in Kedainiai, Lithuania, constructed as part of celebrations commemorating

Lifosa’s 50th anniversary, and the upgrade of social infrastructure and public utilities in Novomoskovsk, site of the company’s Novomoskovskiy Azot nitrogen facility.

Below the operating profit line, the com-panyrecognised unrealised financial foreign exchange losses of RUR 5.9bn, compared to an unrealised gain of RUR 4.3bn in 2012. Changes in these noncash items reflect the impact of the weaker Russian rouble on the company’s primarily US dollar-denominated debt which matches the company’s mainly USD-denominated revenues.

Interest expenses for 2013 increased in line with the Company’s higher debt level and amounted to RUR 5.2bn (2012: RUR 4.3bn). For 2013 the companyrecognised other finan-cial losses of RUR 945m on changes in the fair value of USD/RUR non-deliverable forward contracts and changes in the fair value of cross currency interest rate swaps in amounts of RUR 535m and RUR 165m, respectively.

Balance sheet

Working capital needs decreased slightly as lower prices for finished goods slightly balanced higher prices for certain raw mate-rials. The Company’s net working capital decreased 3% from RUR 23.9bn in 2012 to RUR 23.1bn as at 31 December, 2013

EuroChem’s portfolio of borrowings from banks remained fairly unchanged until late August when the companysuccessfully closed

a club facility for an amount of USD1.3bn. Structured as a 5-year unsecured finance facility and priced at LIBOR 3M + 1.8%, the facility includes a 2-year grace period. The pro-ceeds were immediately used to pay down the outstanding amount under EuroChem’s 2011 USD1.3 billion pre-export facility.

While the company’s debt ratio remained well below bank covenant levels and at all times within the company’s targeted across-the-cycle range, the volatility in the fertiliser markets prompted the Group’s shareholders to proceed with a pre-emptive USD 300m capital injection in the fourth quarter of 2013 through the acquisition of 2.36% of share capital of the Group’s holding company. Consequently, the companyclosed 2013 with a net debt to 12-month rolling EBITDA ratio of 2.07x as compared to 2.27x in Q3 2013 (2012: 1.53x).

Highlighting EuroChem’s strong product and geographic diversification, its partial vertical integration and its advantageous position on the industry cost-curve as its core strengths underpinning its cash flow gen-eration, Fitch Ratings and Standard & Poor’s both affirmed EuroChem at BB / stable out-look in 2013.

Cash flow

At RUR 36.2bn, operating cash flow for the twelve months ended 31 December 2013 remained within 7% of the previous year’s level.

The company’s total capex spending for the January to December 2013 period amounted to RUR 32.6bn (USD 1.0bn), comprised of investments of RUR 12.4bn in potash, RUR 10.4bn in nitrogen and RUR 8.6bn in phosphates. The remainder was allo-cated to its distribution network and logistics infrastructure.

2013 corporate developments

In 2013 the Group finalised the acquisi-tion of 54,613 ordinary shares of OJSC

Eurochem-Belorechensk Mineral Ferulisers plant produces DAP and sulphoammophos



“Murmansk Commercial Seaport” for a total consideration of RUR 3.15bn. These ordinary shares represent 48.26% of the total number of the ordinary shares and 36.20% of the total issued share capital of the Company. As at 31 December 2013, the Group held 36.20% of the OJSC “Murmansk Commercial Seaport” voting rights.

On 10 July 2013, EuroChem announced its intention to consider building an ammonia and urea production plant in Louisiana. A final decision on the parameters and location of the facility should be taken later in 2014.

On 29 July 2013, the companyannounced its plans to create a joint venture (JV) with the Migao Corporation, a specialty potash fertiliser producer based in the southern Chinese province of Yunnan. The JV is expected to bring up to 60,000 tonnes per year of potassium nitrate (NK) and 200,000 tonnes per year of chloride-free NPK capac-ity online by the end of 2014.

Legal proceedings

In October 2012 the group filed a claim against Shaft Sinkers (pty) ltd and Rossal 126 (pty) limited (formerly known as Shaft Sinkers (pty) ltd.), (“Shaft Sinkers”), the contractor involved in the construction of the mining shafts at the Gremyachinskoe potash deposit, seeking compensation for the direct costs and substantial lost profits arising from the delay in commencing potash produc-tion, due to the inability of that construction company to fulfil its contractual obligations. Further details of the proceedings are avail-able in note 34 of the Group’s 2013 IFRS accounts.

In March 2013 the Group filed a claim against International Mineral Resources B.V. (“IMR”) which, the Group believes, held a controlling interest in Shaft Sinkers, claim-ing IMR is responsible for its subsidiary’s actions. In July 2013, a Dutch Court granted EuroChem definitive leave for levying the requested prejudgment attachments against IMR’s Dutch assets, while fixing the amount

for which the leave is granted, including interest and cost at EUR 886m. The court held an in-depth hearing on 21 January 2014 where it considered the arguments and wit-nesses of both sides, following which, the court notified that a final judgment is to be rendered on 16 April 2014.

Outlook

Despite the lingering presence of global imbalances and market volatility, the growth of the fertiliser industry remains solidly underpinned by global food demand. Growing yield gaps in certain regions coupled with the increasing pressure on the global food system from emerging economies and dietary shifts will continue to support and further drive the use of fertilisers.

Following their significant rally, nitro-gen prices have reached more comfortable levels which could be sustained heading into the second quarter on account of plant turnarounds in the Middle East and limited export flows from China to North America as compared to last year. At the same time, weather related delays to spring planting in the US could erode some of the price gains. Nevertheless most producers are in a comfortable spot with many reportedly sold

out until March. While Chinese urea export parameters have been relaxed for 2014, EuroChem expects yearly export volumes from China to remain in line with 2012-2013 levels. In Europe, annual benefit payments to the agricultural sector have been distributed and should provide a positive impact on ferti-liser purchasing activity.

Re-emerging demand in phosphates has tightened supply and provided a boost to prices. While lower ammonia prices may help margins at producer levels, the com-panywould expect to see any significant upward movement in DAP/MAP prices to be matched by a ramp-up in capacity utilisation. Prices are expected to gradually come down as seasonal demand diminished. India’s mar-ket presence is likely to remain limited until after the May elections.

In potash, contract prices have established a floor price for the upcoming months. Potash producers have been applying upward pres-sure on spot prices with product in Latin America and Southeast Asia trading at around USD 350 CFR.While the changes in the ownership of Uralkali should eventu-ally restore joint marketing of product with Belaruskali, this does not appear to be immi-nent in the near term and presents a challenge to significant price appreciation.

Nevinnomysskiy Azot is the largest producer of nitrogen fertilisers in Russia


Chemical equipment www.chemmarket. info

Equipment for the oil and gas industry, such as pumps and production systems, is in particular demand by the chemical industry in the Russian Federation and the Customs Union. The reason is that to date there have not been enough small- and medium-sized enterprises in these sectors to ensure com-petitive production also at international level. This makes the market highly interesting for European manufacturers and their suppliers. However, market access involves challenges that must not be underestimated and a host of regulatory aspects, some of them deviat-ing significantly from European regulations. Matters are rendered even more difficult by the fact that extended customs formalities or special local infrastructure features make the import of products for some sectors of indus-try even more complicated. Other examples include more restrictive import regula-tions and somewhat extensive certification requirements.

Imported industrial equipment is subjected to in-depth testing in test organisations. While in the past the certification procedure has been prone to misuse in individual cases, with certificates in Moscow sometimes avail-able within hours after money changing hands, a separate authority and clear rules

have now been established. There are several certification bodies, testing laboratories and intermediaries for the new TR certificates of the Customs Union (of Russia, Belarus and Kazakhstan). However, even in existing sup-plier relationships it is important to have a partner that offers command of the language, familiarity with the market and long-standing local experience.

Differing safety and quality requirements

The Customs Union created a significant economic area that has established its own standards to monitor and ensure that products satisfy minimum safety and quality require-ments. For this purpose, the CU’s own set of technical regulations (TR) came into effect in February 2013 and now comprises over 20 different safety and quality standards, includ-ing the CU’s Technical Regulation “On the safety of equipment working under excessive pressure.”

Products imported anywhere in the CU need a CU TR certificate. Only mandatory certificates and mandatory declarations meet this requirement. As an important rule, many certificates require manufacturers to submit product samples or involve factory inspec-

tions by experts. In addition, the applica-tion for certification can only be filed by a legal entity located in Russia, such as the manufacturer’s subsidiary, a retailer or the customer. Certification can refer to either a batch of goods or series production. In the latter case, certificate validity ranges from one to five years. In this context manufactur-ers must observe the transition from GOST R and TR to TR CU certificates. All certificates that are still based on the old standards will continue to apply up to 15 March 2015. This time is considered a transition period during which manufacturers can apply for TR CU certificates.

What costs and efforts must be expected?

Small- and Medium-sized Enterprises should expect costs in the four-digit range and allow adequate time for the new certifi-cation process. Manufacturers that frequently deliver components or systems require cer-tificates on series production that are valid for one, three or five years. These certificates are slightly more costly. Manufacturers that need certificates for many different equipment or components may have to expect costs in the five-digit range. Some installations

Certificates for Industrial Equipment and Installations Needed to Access Market of Customs UnionBy Yvonne Oppermann, TÜV Hessen and Yury Kulikou, TÜV SÜD Industrie Service

Manufacturers of industrial equipment wishing to sell their products in the Customs Union (CU) need to obtain special national certifications – such as the new Technical Regulation on pressure equipment that came into effect on February 1, 2014. Working with their affiliate TÜV SÜD RUS, TÜV Hessen and TÜV SÜD support and assist manufacturers throughout the entire process.


Chemical equipmentwww.chemmarket. info

and equipment may fall under the scope of multiple technical regulations, consequently requiring several certificates. In case of a one-off export or exports at irregular longer time intervals, a single certification which is available at relatively low costs may be sufficient.

Companies preparing for certification in accordance with the new standards often invest

30 to 40 person-days of work, not includ-ing translation into Russian. Comprehensive support by a qualified partner can help to speed up the process. As the Customs Union increasingly orients itself to European stand-ards, processes are expected to become less time-intensive in the future.

What documents are required?

In addition to the application form, customs code (HS code) and product name in English or Russian (series number, model etc), manufacturers must supply technical docu-mentation (in Russian, German or English) as well as product design drawings, material specifications and assembly instructions. Test records and an ISO 9001 certificate, where available, are also considered important documents. The product description should cover all components included in the scope of delivery. Service providers commissioned to carry out certification can prepare their quotations on the basis of these documents. Where appropriate, a checklist that specifies the other documents to be submitted can be enclosed with the quotation.

After the Russian regulatory bodies have

checked the documentation for conformity with the Russian codes and standards, the service provider will coordinate the certifi-cate with the client. Clients should normally receive an acceptance report by email, with the original certificates and certified copies following by post; they can then be presented to import and customs controls. Once all documents are complete, processing of the applications takes an average of three weeks.

TÜV HessenYvonne OppermannRüdesheimer Str. 11964285 DarmstadtGermanyTel.: +49 6151 [email protected]

TÜV SÜD Industrie ServiceYury Kulikou Gottlieb-Daimler-Straße 770794 FilderstadtGermanyTel.: +49 711 [email protected]/is

TÜV Hessen and TÜV SÜD provide comprehensive consulting services on GOST and the new TR CU cer-tificates issued. Experts with long-standing experience determine the certificates that German manufactur-ers must submit to export their prod-ucts and place them into service, and the criteria their products must meet to obtain these certificates. For cer-tification, products have to undergo desktop/document review plus “con-ventional” conformity assessment. The documentation is in Russian. A further advantage for German ex-porters is the direct contact to Rus-sian authorities they can establish via the affiliate TÜV SÜD RUS.


Countries and regions www.chemmarket. info

Almost eight years have passed since the first issues of our magazine containing articles reviewing the chemical industry of different countries were published includ-ing an article covering the then state of the Uzbek chemical sector. The country is the 56th largest in the world by area and the 42nd by population. Among the CIS countries, Uzbekistan is the 5th largest by area and the 3rd by population after Russia and Ukraine.

In fact, the chemical industry of Uzbekistan has a long history of development. The first chemical plants were launched in the early 30s of the 20th century. A number of large agrochemical factories were constructed in the country because of the demand of the agricultural sector for mineral fertilisers and pesticides. As a result, it became a strong foundation for the creation of one of the most vigorous industry sectors in Central Asia.

Major economic changes took place thanks to the privatisation of the chemical industry over the first 15 years of the independence of the country. Several new chemical plants together with mining and processing com-plexes supplying feedstocks to the first ones were constructed.

Our journal has dedicated a great deal of information to difficulties connected with the transition from the planned Soviet economy to up-to-date market models. The planned economy inherited from the Soviet Union and closer government control over privatisation processes with keeping the controlling stake in the hands of state companies are the main vectors of the economic development in Uzbekistan. This model has been operating relatively

successfully till nowadays. This model is the most effective for the development of natural resources - oil, gas, etc.

As for factories of the manufacturing industry, which were built before the collapse of the USSR, production output at most of them stabilised and gradually ramped up. Through some uncompetitive workshops and sometimes even entire manufacturing plans were closed down. Now, after raising invest-ment resources and improving the legislative framework, the government has prepared the chemical industry for radical changes, which are taking place today.

In recent years, the chemical industry of Uzbekistan produces more than 1m tonnes of mineral fertilisers, more than 120,000 tonnes of chemical crop protection products, 1.35 million tonnes of sulphuric acid, 50,000 tonnes of chemical fibres, more than 90,000 tonnes of coatings, over 120,000 tonnes of plastics and synthetic resins. A consider-able part of these products are successfully exported.

Uzbek chemical output showed a 5.3% YOY rise due to stable development of the chemical industry. Total production of the industry amounted to UZS 1,554 bn. In H1, 2013 the production of the following chemi-cal products increased: phosphate fertiliser – (+5.1%); complex compound fertiliser – by 3 times; sulphuric acid – (+6.2%); wet-process phosphoric acid – (+10.5%); ammonium sul-phate - (+18.2 %); strong nitric acid – by 1.8 times; suprephos - (+3.2%); soda ash - (+26.3 %); hydrochloric acid - (+9.7 %); acetic acid – by 9.1 times; acetaldehyde – by 1.7 times; chemical crop protection agents - (+12.4 %);

carbon dioxide - (+4.8%); technical salt – by 2.4 times; polyethylene film – by 5 times.

I. Raw material recourses

Uzbekistan has a strong mineral raw mate-rial base, which is one of the major sources of income for the country’s economy. Today this base consists of more than 1,800 of mineral deposits, about 1000 of mineral occurrences and 118 types of minerals, of which 65 are mined. Mineral resources of Uzbekistan are estimated at about USD 3.5 trillion.

Geological reserves of natural gas in Uzbekistan are over 5 trillion cubic metres. Proven reserves of natural gas - 3.4 trillion cubic metres (including the following depos-its: Sho’rtan - 0.5 trillion cubic metres and Alania - 0.2 trillion cubic metres and Urga with reserves of 1.5 trillion cubic metres). The Gazly deposit is located 100 km to the north- west of Buxoro and has been devel-oped for several decades. Reservoir rock is sandstones. Gas contains 96-97% of meth-ane. Sulphur-free gas accounts for the main share of total production, but more and more low sulphurous gas and sour gas are pro-duced. The Shakhpakhty and Kuanish gas deposits are located in the Ustyurt district. In 2010, new natural gas fields were found in Uzbekistan near the Kosbulak downfold and North Ustyurt region (Western Aral), as well as at the prospective area of Ernaz in the Buxoro-Xiva oil and gas region. Uzbekistan occupies the 14th place in the world in terms of natural gas reserves and the 11th in terms of gas production. Natural gas production in Uzbekistan in 2012 totalled 62.9bn cubic

Review of the Chemical Industry of Uzbekistan: A Strong Focus on Modernisation


Countries and regionswww.chemmarket. info

metres. Production of liquefied gases for the same period amounted to 273.600 tonnes.

O’zbekneftegaz produces 70bn cubic metres of gas and 8m tonnes of liquid hydro-carbons per year.

CNPC (China National Petroleum Corporation), KNOR (Korea), Gazprom and Lukoil (Russia) hold strong positions in the Uzbek energy industry. Oil geological reserves in the country are estimated at 5m tonnes and proven reserves – 530 m tonnes.

Hydrocarbons fields of the Fargona Basin - North So’x, South Alamyshik, Polvontosh, Galcha-Changara and smaller Chimyon, Shoʻrsuv and others mostly contain oil. Oil is mainly light, sweet, paraffin, with a high con-tent of light distillates. Ozokerite (earth wax) is a by-product of refining the oil from these deposits. The oil fields Xaudag, Uchkyzyl, Kokayty, Kashgar and Amudaryo are discov-ered in the Surxondaryo Province. The oil and gas deposit Lalmikar is almost completely depleted. Oils in the region are heavy and sul-phur. Gas condensate (Adamtash, Gumbulak, Pachka-mar, Kyzylbayrak and Amanat) and oil fields are located in the South-West Hisor. North Muborak and Akdzhar are oil-bearing deposits – in the Buxoro-Xiva province.

In 2012, oil and gas condensate production in Uzbekistan amounted to 3,16m tonnes: oil production - 1,56m tonnes and gas conden-sate – 1,6m tonnes.

There are three major coal deposits in Uzbekistan: Angren (Toshkent province), Shargʻun and Boysun (Surxondaryo prov-ince) as well as several smaller ones. All these deposits consist of alternating layers of sand and clay rocks, with subordinate coal beds formed in the wetland conditions of riv-ers’ valleys and deltas.

The Angren deposit is located in the val-ley of the River Angren, and is known for heavy beds of lignite with a total amount of 1.9bn tonnes. The deposit is developed by an open-pit method. The Angren heat and power station operates on its basis. The Shargʻun deposit is located in a mountainous area (alti-tude 600-800 metres). Coal seams average 4.5m and may even reach 12m; the heating

value of coal is 22,000 kcal/kg. The Boysun deposit has two coal-bearing strata of up to 2.5m.

Probable reserves of oil shales in Uzbekistan are about 47bn tonnes. The yield of diesel fraction from combustible shale of the Sangruntau deposit (C1 + C2 = 357m tonnes) reaches about 30%. This yield is the highest among the major deposits of this type in the country. The country takes the 7th place in terms of uranium reserves accounting for 4% of global reserves) and the 5th – in terms of uranium production. Currently, about 40 deposits are explored, and the largest one is Uchkuduk. Such deposits as Kendyktube, Ljavljakan, Sugraly, Tohumbet, North Kanimekh, Alenda, Mejlisaj are operating as well. The estimated reserves of uranium are 185,800 tonnes (138,800 tonnes - arenated deposits of uranium, 47,000 tonnes - black shale deposits).

Uzbekistan is ranked fourth in the world for gold reserves, and ninth in terms of gold production. According to the State Geological Committee of Uzbekistan, 41 gold deposits are discovered in the coun-try, and nine of them are being developed. Explored and proven gold reserves in Uzbekistan are estimated at about 2,100 tonnes. Total reserves reach approximately 3,350 tonnes. Gold is mined in the basin of the River Zarafshon and in the Kyzyl Kum. The Muruntau, a unique gold deposit, is con-sidered to be the largest one in Eurasia and has been developed since 1967. Its ores are of the gold-quartz type. In 2012, 90 tonnes of gold were produced at this deposit and nearby ones (Kokpatas, Marjonbuloq, Guzhumsay, Promezhutochnoe, Charmitan, Kara-Kutan and others – 12 in general).

About 900 ore occurrences and depos-its of copper are known in Uzbekistan, but only three deposits are operated. Uzbekistan holds the 10th place in the world in terms of proven copper reserves. Copper deposits and ore occurrences are common for the Middle Tien Shan and especially the Qurama Ridge. The main deposits are concentrated in the Olmaliq province. These are Kalmakyr,

Dalnee and Sary-Chequ as well as a number of smaller ones (Balykty, Karabulak and others). Olmaliq KMK (Olmaliq Mining-Metallurgical Complex) operates on the basis of porphyry copper deposits.

Lead and zinc deposits are mainly located in the Middle Tien Shan, in the Chatkal-Kuraminsky mountains and, in particular, at the Kurgashinkansky mine (the Olmalig province) and a number of smaller manifes-tations (Koshmansay, Miskan). The main ore minerals are galenite, sphalerite, chalcopyrite and pyrite. Magnetite and hematite also occur there. Trace elements are indium, silver, bis-muth and gold. Rare-metal mineralisation, including scheelite and molybdenite, are essentially developed at the Koshmansay deposit. The Kurgashinkan deposit is cur-rently operational. Namely owing to the development of this deposit the country is on the third place in the world in terms of cadmium production. Ores are processed at the Olmaliq KMK. Sulphide-polymetallic deposits of lead and zinc are located in the southwest Hissar (Handiz). The main ore minerals are pyrites, sphalerite, galenite and chalcopyrite, but there are also gold and sil-ver minerals.

Carbonate-polymetallic lead-zinc depos-its (Uchquloch, Sarykan, Kandzhaylau and Kulchulak) are typical for the Middle Tien Shan. The Uchquloch deposit, which is located in the foothills of the Nurota North Range, the Hanbandytau Range, is the most promising field. The main ore minerals are galenite, pyrite; secondary - chalcopyrite, marcasite, covellite, bornite-chalcocite.

Lode lead-zinc deposits are common in the Middle Tien Shan Mountains, especially in the Kurama mountaines. The ores of these deposits contain high amounts of bismuth and silver (especially the Lashkerek deposit).

Tungsten deposits are concentrated mainly in the Southern Tien Shan. They are pre-sented by a group of postmagmatic contact skarn scheelite formations, which occur in the Nurota, Zirabulak, Karatyubin and Chakylkalyan mountains. The Ingichka and Qoʻytosh deposits are operated on their



basis. The most interesting deposits are Langar, Qoʻytosh, Ingichka, Kara Tube and Yahton; less promising for industrial devel-opment – Chash-Tepe, Kamangaran, Djam, Sarykul and Sazagan. Such tungsten deposits like Sargardon and a group of deposits and ore occurences of Maydontol - Oygaing dis-trict (Anaulgan-Karakyz, Oygaing) are the most important in the Middle Tien Shan and the Chatkal-Kurama mountains.

Uzbekistan has a number of molyb-denum ore occurrences of hydrothermal type: Obizarang in the west of the Hissar Ridge, Oygaing in Chatkal, quartz-sericite-scheelite-molybdenite (Chavata, Unkurtash in Chatkal, Shaugaz in the Kurama Ridge), skarn-molybdenite (Chimgon in Chatkal), skarn-scheelite with molybdenite, quartz-sericite-molybdenite-chalcopyrite (Olmaliq district). However, molybdenum is recovered as a by-product of copper porphyry ore min-ing, which is the 8th deposit in terms of Mo reserves.

Bismuth deposits are discovered in the Chatkal-Kurama Mountains. The main formation is arsenic-bismuth (Urtasaray, Burchmullo) and copper-bismuth. The Ustasaray is the only operating deposit. There are also copper-bismuth deposits, such as Kyzylgut in the Kurama Mountains, Tashkesken in the Chatkal Ridge and Uzumlek in the Maygashkan. There are sev-eral hundred of iron deposits and occurrences of different genetic types and formations in Uzbekistan, as well as a number of magnetic anomalies, which are possible indicators of iron ore. The Tebinbulak titanium-magnetite deposit (Qaraqalpaqstan Respublikasi) is the most significant. The Kazgantau deposit, which is located in the Hissar belt, presum-ably refers to this type. Skarn-magnetite deposits mainly occur in the Middle and South-Western Tien Shan in the Chatkal-Kurama mountains.

Sedimentary iron ore occur in the Aral sea region, the Kyzyl Kum desert and the Sultan Uwais. There are ore objects containing silver in Uzbekistan. The country takes the

third place among the world leaders in terms of silver reserves. Uzbekistan also has man-ganese deposits in the Zarafshon, Zirabulak, Karatyube and Lolabulak mountains - Ziyovuddin, Dautash, Kyzyl Bayrak, Tahta Karachinsk, Tersaksay and Chapanatin. The content of manganese is 8-28%. Reserves of some deposits are small but promising and in the total amount is about 8 million tonnes.

Sedimentary manganese deposits and occurrences are found in the northern and northeastern parts of the country (Azatbash, Mazarskos, Morguzar and Karaalminsk occurrences).

Magmatic deposits of chromium of Kyzyl Kum-Fatgona belt in the Tamdytau and Sultan Uwais are of particular interest.

More than a hundred of tin ore occurrences and several small deposits are known, but only the Karnab deposit operated in the 50s of the 20th century.

Mercury and antimony are not mined in Uzbekistan because of the lack of identified cost-effective commercial deposits. A large number of ore occurrences that can become operating mines have been discovered. The most promising one is located in the South Fargona belt, where more than a hundred of mercury and more than ten of antimony occurrences have been discovered. The most significant occurrences are located near Kokpatas in the Navoiy province. The Myksk, Shutsk and Karasu deposits can also be developed.

A lot of bauxite (a raw material for alu-minum production) occurrences are found in Uzbekistan, but there are no deposits. Bauxites occur in the Kyzyl Kum, Nurota, and South Fargona regions. The most signifi-cant ore occurrence is Aktau in the Tomditov Mountains. Karst occurrences are found in the Nurota district (Mirishkor, Kyzyl Bulak) and coastal bauxite occurrences are located there as well (Qoytosh, Narvan, and Karatau). Bauxites are also available in the Hissar and Kyzyl Kum districts. More than 70 ore occurrences are available in the Hissar district. The Kayrak occurrence in the

Boysuntov Mountains and the Kandadzhuaz in the Mechetly Mountains may be commer-cial deposits. In general, there are prospects of developing commercial bauxite deposits in the country.

This also applies to other two feedstocks for aluminum production - alunite and kaolin. There are alunite ore occurrences and depos-its in the Kurama, Chatkal and Hissar moun-tains. The largest one is the Gushsay deposit in the Kurama Ridge. Pilot testing showed a high degree of extraction of alumina. We should also mention the Angren kaolinic coal deposit – a quite large one. A ceramic factory is built on the base of this deposit. So, kaolin is currently used as a raw material for refrac-tories. Primary kaolin seams are within the range of 2-46m.

Uzbekistan has large reserves of dolomite. The Farkhad rock deposit provides dolo-mites, which are used as refractory materials.

Bentonite clays are mainly located in the Ustyurt in the South Aral, Sultan Uwais, the central part of the Kyzyl Kum desert and the Zirabulak-Ziadin mountains. A total of 40 deposits have been discovered.

Commercial talc can be found only in the Sultan Uwais. The major deposits are Zinelbulak, Kazgantau and Kyzylsay.

Natural sulphur occurs in the Farg’ona district: Kyzyl-Archinsk, Andijan, Kurshab and Amu Darya district with sulphur-bearing deposits in the Ustyurt. The Tyubegatan deposit is considered to be the most promis-ing one. However, in Uzbekistan big volumes of sulphur are produced not at natural depos-its but by removing sulphur from natural gas at the Muborak gas processing plant in Qashqadaryo province.

More than 30 ore occurrences and deposits of graphite are known in the country.

Uzbekistan is rich in sodium chloride and potash salts and has lower reserves of magne-sium and sodium sulphates. The most signifi-cant deposits are Tubegatan, Baybichekan, Akbash, Lyalimkan, Hodzhaikan and Gaurdak-Kugitang.

Salt-bearing layers in all the mentioned



above deposits occur at substantial depths and can be mined by in situ leaching methods. Since 2010, Dehkonobod Potash Fertiliser Plant has been operating on the basis of the Tyubetagan deposit.

Salt formations (lacustrine and saline) occur on the plains, in the erosion and intermountain areas. The largest deposits of this type are Kushkanataus, Karaumbet, Kumysbulak and Tumryuk.

The Barsa-Kelmes deposit of sodium chloride, which is located close to the former island of the almost dryed Aral Sea, is the main source of raw materials for Qo’ngirot Soda Zavodi (Qo’ngirot soda plant). Its proven reserves - 131 m tonnes of salt with a NaCl content of more than 97%.

Since 1997, the Navoiy kon-metallurgiya kombinati (Navoi Mining and Metallurgical Plant) has been developing the Dzheroy-Sardara phosphorite deposit. This deposit is located in the Central Kyzyl Kum. The reserves of the deposit are estimated at 300m tonnes of ore and 58m tonnes of phospho-rus pentoxide. The reserves will cover the demand of the country’s agricultural sec-tor for phosphorus fertilisers for more than 100 years. Total reserves of phosphorite of the Kyzyl Kum region exceed 1bn tonnes. However, the deposit has low-grade ores, which are characterised by a high content of carbonate minerals and chlorides. That is why phosphates here require preliminary beneficiation. In addition, there have been carried out preliminary exploration of the Karakatinsk deposit and evaluation of the South Dzhetym Tau deposit. Both deposits are also located in the Central Kyzyl Kum., It is possible to start the beneficiation of phosphorites (there are significant reserves of phosphorites in the country) on the basis of the Karakatinsk and South Dzhetym Tau phosphorite deposits with the help of foreign investors in order to increase production and exports of phosphate fertilisers.

There are eight explored deposits of gypsum in Uzbekistan (the largest one is Tubegatan).

A total of 17 deposits of limestone and chalk have been explored, and five of them are operating (Sherobod, Jizzax, Qorovulbozor, Quvasoy and Dzhamansaysk). They are located throughout the country. The Dzhamansaysk limestone deposit, which is mined 250km from the production site of Qo’ngirot Soda Zavodi, is characterised by proven reserves of about 70m tonnes.

It should be especially noted, that there are large reserves of such cement raw materials as limestone, chalk, marlstone, clays and clay loam in Uzbekistan.

The deposits of fluorspar, which is used as a source of fluorine, are located in the Chatkal-Kurama Mountains, with occur-rences in the southwestern Hissar, and a few of them can be found in the boundary belts of the Southern Tien Shan.

Commercial deposits of fluorite are oper-ated in the country.

In Uzbekistan, magmatic deposits of feld-spar are found (Langar, Lolabulak, Karichsay in the Southern Tien Shan). Sedimentary deposits - quartz-feldspar sands - are dis-covered in the Zirabulak-Ziadin Mountains (Kermininsk, Karzhantau). Uzbekistan is one of the 15 largest countries in the world in terms of mining feldspar. Feldspars are used in the ceramic industry as a flux; in the glass industry -as fillers and light abrasives (e.g., in the manufacture of toothpaste).

Uzbekistan has about 50 occurrences and deposits of wollastonite. Most wollas-tonite deposits are located in the Southern and Middle Tien Shan (Qoʻytosh, Langar, Karatube, Ingichka, Yakhton, Akbulak, Chimgan, Kumyshkan, and Barkrak). Wollastonite is used as an additive filler in plastics, non-ferrous metallurgy, in the tyre, asbestos and coating industries, and in the production of ceramics. Wollastonite is also used in the car industry, as a part of a filler for a number of important automotive com-ponents: brake pads, plain bearings etc. It is used in anti-corrosion coatings as well.

Only one glauconite sandstones deposit has been discovered in Uzbekistan - Changi

in the Suren Atinsk Ridge. A high content of potassium oxide and the ability to yield to weathering makes glauconite a useful fertiliser. It is also used as a raw material for manufacturing green paints. There are also reserves of corundum in the country (the Sharaksay deposit in the Malguzar mountains and the Aktash deposit in the Karzhantau mountains).

Mirabilite deposits with reserves of sodium sulphate, which exceed 1.5 b tonnes, are discovered in the western deepwater area of the Aral Sea, in the Gulf Tuschibas, and in the western part of the “Small Aral” under a 0.5 - 1.5m layer of silt on the total area of about 2000 km2.

Uzbekistan takes the 5th position in the world in terms of cotton production and the second position for of cotton exports.

In order to develop the mining industry, the government offers more than 500 industrial facilities to potential investors including 4 deposits of metallic ores, 26 deposits of vari-ous ores and 10 deposits of minerals intended for chemical production. All in all 38 mineral fields are proposed to be invested in. A total of 159 large deposit occurrences are proposed for geological survey.

II. Subsidiaries of JSC O’zkimyosanoat

All industrial enterprises in Uzbekistan, which are engaged in chemical production, can be divided into two groups - the part of the state joint-stock company O’zkimyosanoat (Uzhimprom), which was founded in 2001, and independent companies. Most chemical plants in the country belong to the first group. The Uzbek chemical industry is mainly based on agrochemical production. On one hand, it is determined by the need to intensify the use of farmlands along river valleys, while most of the country is covered with deserts and mountain ranges, which are not arable. On the other hand, Uzbekistan has rich deposits of phosphoric and potash ores, and natural gas - basic raw materials for the production of mineral fertilisers.



O’zkimyosanoat implements production, innovation, marketing programmes aimed at developing chemical enterprises, creating conditions and prerequisites for sustainable development of the chemical industry. An important aim of the company is privatisa-tion of chemical companies with attracting foreign and domestic investors.

O’zkimyosanoat includes 14 manufac-turing plants turning out more than 170 chemical products. 13 regional distribution organisations marketing fertilisers across the country are also involved in the struc-ture of O’zkimyosanoat. Scientific research and design institutes, haulage companies Kimyotrans and Kimyotrans-logistik engaged in foreign economic activities, as well as bro-kerage company Hamqor-kimyoservis, are members of O’zkimyosanoat JSC.

As for the company’s production results of the first nine months of 2013, we should mention the following: the subsidiaries of O’zkimyosanoat produced goods at current prices for UZS 1.25bn (about EUR 414m); consumer goods were manufactured for UZS 90.2bn (about EUR 30m); 846,430 tonnes of fertilisers were turned out including nitrogen fertilisers – 648,570 tonnes, phosphorus-containing fertilisers – 122,000 tonnes and KCl fertilisers – 75,860 tonnes.

According to an import-substituting programme, in January-September 2013

O’zkimyosanoat produced goods worth UZS 270.6bn (about EUR 89m), or 107.6% of the planned figure. Within the framework of investment projects included in the com-pany’s investment programme, the plants of O’zkimyosanoat spent USD 136.66m of investments on various purposes. Now it is time to tell about the subsidiaries of O’zkimyosanoat in details.

Navoiyazot JSC

Founded in 1961, Navoiyazot JSC (Navoiy) is the largest chemical enterprise in Uzbekistan. Today the plant employs more than 11,000 people. It accounts for over 30% of chemical production manufactured in Uzbekistan. Its product range includes products of several segments of the chemical industry.

Initially, Navoiy Chemical Plant (this was the name of the company till 1975) manu-factured weak nitric acid and ammonium nitrate, which went into production at the end of 1964.

Launching a unit for filling cylinders with technical oxygen in November 1965 was a significant event for the company. In 1965-1967 the plant started production of ammonia and ammonia water. In 1968-1970, work-shops for carbon dioxide, sodium cyanide, hydrocyanic and acetic acids, acetylene,

acetaldehyde and ammonium sulphate were launched. In 1971 a new production line for ammonia, weak nitric acid and ammonium nitrate was put into operation. In 1973 the first batch of acrylonitrile was produced, and commercial production of ‘Nitron’ synthetic fibres was set up. In 1975, the company became a production association, and the following year production at the complex ‘Catalyst’ started up. In 1982-1983, the plant continued capacity expansion and widening a range of ‘Nitron’ synthetic fibres Nitron.

In 1988, a thiourea and hydrochloric acid plant came on stream. In 1990-1991, produc-tion of consumer goods started up. In the fol-lowing two years the company proceeded to manufacturing epoxy resins, polyelectrolytes and synthetic fabrics; polyacrylamide glue, salt, sodium tripolyphosphate and colloidal sulphur.

In 1996-1999, lithium carbonate, ammo-nium thiocyanate, methanol, acetone, argon went into production. In 2001, a workshop for caustic soda and liquid chlorine was put into operation. The workshop was built in cooperation with Germany-based Lurgi. After that production of formalin, hydrochlo-ric acid, sodium hypochlorite and ammonium chloride was mastered.

In 2002 the company was transformed into a joint-stock company. The authorised capital of the company as of July 2009, when the company’s assets were revaluated, exceeded UZS 42bn (about EUR 139m). Total number of shares was 753,696 shares. Nominal value per share was UZS 55,918.

In accordance with the order of the State Property Committee, the shareholding struc-ture of Navoiyazot is as follows: the state’s share is 51% (384,385 shares), the share for sale to foreign investors - 49% (369,311 shares).

Today the company manufactures more than 60 kinds of products. The main ones are liquid ammonia, ammonia water, caustic soda, ammonium nitrate, nitrogen-phosphate fertiliser (mixture of melt NH4NO3 and phosphorite meal), ammonium sulphate, Outdoor production unit at Navoiyazot



liquid chlorine, hydrochloric acid of various grades, ammonium chloride, sodium chlo-ride, sodium chloride of pharmacopeia grade, sodium hypochlorite, sodium cyanide, nitric acid, carbon dioxide, argon gas, oxygen gas, pyrolysis acetylene, acrylonitrile, acetalde-hyde, acetic acid of different concentrations, methanol of various grades, polyacrylamide gel, formalin, thiourea, methyl acrylate and acetone.

Polyacrylic fibre and yarn made under the trade name Nitron is one of the major prod-ucts of the company, which is used in the pro-duction of women’s and children’s hygiene products by a joint Uzbek-Chinese company Navoiy Hunan Pulp LLC. The company is located in the free industrial economic zone Navoi. A carpet weaving company Horazm Gilamlari JSC (Xorazm) and Ozoda Ozod Joint Venture (Buxoro) are the largest con-sumers of fibres from Navoiy.

Thiourea solutions manufactured in Navoiy are used to dissolve gold from refrac-tory ores and concentrates, while a cyanide process does not yield good results (thiourea dissolves gold in acidic solutions in the pres-ence of an oxidant with forming a cation type complex. Water-soluble polymeric agent Uniflok (hydrolysed polyacrylonitrile) pro-duced by the company is used for strength-ening wellbore walls, reducing fluid losses while drilling and stabilising drilling muds, enhancing oil & gas reservoir performance, for sedimenting suspended particles in sedi-mentation tanks and water tanks, filtering and precipitating different pulps in domestic and industrial water supply.

Another water-soluble polymer - agent K-4 - is used to reduce fluid loss and stabi-lise drilling muds. It also finds application in agriculture as a gelling agent; for sediment-ing suspended particles in sedimentation tanks and water tanks; as an adhesive in the printing industry; for dust control in the met-allurgical industry; as a flocculant for fighting sand movement.

Another water-soluble polymer agent K-9 is intended for well drilling opera-

tions. Granulated polyacrylamide (a mixture of polyacrylamide with ammo-nium sulphate), manufactured under the trade name Flocculant PAA-GS, is used in the form of diluted aqueous solution for suspension flocculation in the mining, chemical, pulp and paper and by-product coking industries as well as domestic and industrial water supply. Acrylic emulsion also produced by the company is used for manufacturing water-based paints, in the leather, textile and furniture industries and for producing adhesives.

Urea-formaldehyde resin of KFZH grade is widely used for manufacturing plywood, gluing furniture parts; building products and joinery; for production of moulding cores and casting moulds; soil stabilisation; as well as for manufacture of moulding materials, laminated and foam materials, adhesives, coatings, paper and fabrics manufacture; for gluing abrasive grains onto abrasive paper. KS-11 is another urea-formaldehyde resin,

which is applied for production of mineral-cotton materials as a binder.

There are production facilities for pentae-rythritol and zinc nitrate as well.

Today Navoiyazot JSC is dozens of work-shops, which make up a single industrial mechanism for accomplishment of produc-tion tasks (Table 1).

The main raw materials purchased by the company are: natural gas, soda ash, indus-trial salt, ferrous sulphate, sulphur, catalysts, monoethanolamine, isopropanol, cationic dyes, hydroquinone, diisopropyl ether, ita-conic acid and sorbital.

Domestic raw materials account for a substantial part of the company’s feedstock consumption. The major local suppliers of raw materials are Navoiy Kon-Metallurgiya Kombinati JSC (Navoiy Mining and Metallurgical Plant), Samarqandkimyo JSC, Olmalik Kon-Metallurgiya Kombinati JSC (Olmaliq Mining and Metallurgical Combine), Muborak Gazni Qayta İshlash

t Production structure of NavoiyazotProduction workshops Start-up Capacity, thousand tonnes / year

‘Ammonia-I,II’ 1964 370

‘Ammonia-III’ 1971 180

Production of nitric acid – second (II) stage

1965 351

Production of nitric acid – second (III) stage

1971 400

Production of ammonium nitrate –first and second (I-II) stages

1964 350

Production of ammonium nitrate –third (III) stage

1971 600

Production of N-P fertiliser 2010 180

Production of ‘caustic soda and low-tonnage chemical products’

1976

Including: 1) NaOH, chlorine, 26,000 tpy chlorine-based production; 2) NH4Cl; 3) ‘Unifloc’ preparation; 4)

polyacrylamide; 5) hydrochloric acid; 6) methanol; 7) pentaerythritol; 8)

formalin; 9) urea-formaldehyde resin; 10) water-soluble polymers; 11) NaCl; 12) flammable liquid storage facility

Organic chemicals 1969

Including: 1) acetylene; 2) hydrocyanic acid and sodium cyanide; 3) acetic

acid; 4) acrylic acid nitrile; 5) ammonia liquefying workshop

Production ‘Nitron’ fibres 1983 In addition to fibre, K-9 preparation

Production of technical thiourea 1987 1,4



Zavodi JSC (Muborak Gas Processing Plant) and Ammofos Maxam JSC.

Navoiyazot sells its products both on the domestic and foreign markets. Positive dynamics of export supplies plays an impor-tant role in ensuring the financial stability of the company. One of the main income items of the company is nitrogen fertilisers sup-plied to local agricultural producers. Other major consumers include O’zkimyosanoat SJC, Navoiy Kon-Metallurgiya Kombinati JSC, Olmalik Kon-Metallurgiya Kombinati JSC, Navoiy TES JSC (Navoi TPP), Chkalov Nomli Toshkent Aviasiya İshlash Chiqarish Birlashmasi (Toshkent Aviation ON by Chkalov) and Toshkent Traktor Zavodi.

The main export markets of the company are Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, China, Iran, Pakistan, Turkey, Ukraine, Russia and United Arab Emirates.

So, we know what the company produces today, but what Navoiy chemists will manu-facture in the coming years?

Currently O’zkimyosanoat is consider-ing the project “Construction of a plant for polyvinyl chloride (PVC), caustic soda and methanol on the basis of Navoiyazot”. The development of a preliminary feasibility study was completed in August 2012 fol-lowed by its agreeing with an authorized expert group. The latter gave its positive verdict after giving recommendations and eliminating deficiencies. In May 2013 a tender for turnkey construction of the plant was announced. The winner - China National Chemical Engineering Group Corporation (CNCEC) was announced on 28 August, 2013.

According to the feasibility study, the cost of the project totals USD 501.1m and its estimated capacity for suspension PVC – 100,000 tpy, caustic soda – 71,800 tpy, methanol – 295,400 tpy. The payback period including the invest-ment period - 9.2 years. The implementation of the project will provide the needs of the construction, electrical, medical, petrochemical and chemical industries of the country for the mentioned products. Moreover, it is planned to export 50,000 tonnes of PVC and 22,500 tonnes of caustic soda annually.

Creating PVC production will enable the company to utilise chlorine obtained in the course of caustic soda manufacture. It has already been noted that the country has suf-ficient reserves of technical sodium chloride for producing caustic soda and chlorine. PVC production will utilise acetylene (via chloride monomer), and acetylene will be obtained from natural gas.

The feasibility study also envisages the construction of an oxygen and argon gas workshop to cover the growing needs of Uzbek companies for technical gases.

It is planned to use methanol as a petrol additive. Wastes of methanol production (distillates) will be used as an additive to natural gas during transportation through trunk pipelines to fight gas blocks. In the future, the bulk of methanol will be directed to a methanol-to-olefins complex planned to be built in years to come.

After putting the integrated plant into operation, about 900 new jobs will be cre-ated. Products worth USD 234.5mn will be manufactured annually, including exports - more than USD 68.5m.

The plant is due on stream in 2016.Navoiyazot JSC actively implements

other investment projects aimed at develop-ing innovative technologies and upgrading equipment in order to achieve sustainable competitiveness of products at the domestic and foreign markets by improving products quality and reducing their production costs (Table 2).

Farg’onaazot JSC

Farg’onaazot JSC (Farg’ona) is one of the leading manufacturers of ammonia, ammonium

nitrate and urea in the country. It was com-missioned in 1956. The company’s produc-tion facilities have been repeatedly upgraded and increased over the last ten years. Now it can turn out up to 400,000 tonnes of ammo-nia, 360,000 tonnes of weak nitric acid, 425,000 tonnes of ammonium nitrate and 270,000 tonnes of urea per year.

Moreover, Farg’onaazot manufacture sodium chlorate intended for production of defoliants and chlorine dioxide for bleach-ing pulp and fabrics, water disinfection, and weed killing (herbicide). Another important product of the company is liquid defoliant - 36% aqueous solution of magnesium chlo-rate. It is used in agriculture for preharvesting elimination of leaves and for drying plants (cotton plants, soybeans, sunflowers and potatoes). Universal complex action defoli-ants “UzDef” and “PoliDef” complete the range of agrochemicals.

In 2010 Farg’onaazot put into operation a baking soda production line designed to manufacture 1,000 tonnes of NaHCO3 per year. The equipment utilised for production of sodium bicarbonate was made by local manufacturers, and only local raw materials are used.

A few years ago, with the assistance of Chinese company Greencool Engineering, a cellulose diacetate unit was revamped. Cellulose diacetate is used for manufac-turing acetate filament and acetate silk as well as cigarette filters. The former

Table 2. Projects of NavoiyazotProject Start-up Capacity

Construction of an ammonia and carbamide complex

2014660,000 tpy of ammonia, 1,000,000 tpy

of carbamide

Expansion of thiourea production 2014 Capacity expansion up 3,000 tpy

Construction of potassium nitrate production

2015 3,000 tpy

Construction of unit for bleaching agents for textile manufacture

2015 10,000 tpy

Construction of monochloroacetic acid production

2015 5,000 tpy



Farg’ona chemical fibre plant, a subsidiary of Farg’onaazot became a production site for cellulose acetate fibre manufacture. The plant, which can also produce tyre cords and nylon-6, was put into operation in 1998. The main raw material for tyre cords and nylon-6 was caprolactam. Polyamide-6 capacity totalled 7,000 tonnes per year. But polyamide-6 capacity is currently idling due to lack of floating capital and sales markets, but is in good condition and ready for operation.

Besides the company can turn out sodium nitrate and carbamide-ammonia mixtures. The major importers of its prod-ucts are Russia, Tajikistan, Turkmenistan, Kyrgyzstan, China, Iran and Afghanistan.

The main raw materials consumed by the company are natural gas, sulfuric acid, hydrochloric acid, industrial salt, magnesium chloride, caustic soda, monoethanolamine and cotton cellulose. Currently, it employs about 7,000 people.

The Farg’ona plant follows the course for upgrading chemical production taken by O’zkimyosanoat SJC. In 2014-2015, it is planned to conduct large-scale modernisa-tion of ammonia synthesis unit AM-76 and urea production. One of the key results of the modernisation at Farg’onaazot JSC will be a reduction in ammonia production costs. The expediency of the reconstruction is deter-mined by three factors: ammonia is a basic component of many mineral fertilisers; the volume and cost of the product determine the amount of fertiliser produced and their cost; the construction of the new units require large capital expenditures.

The main aim of the new investment project is to improve the reliability and per-formance of equipment at AM-76 unit and its operational safety, reduce energy con-sumption and, as was previously mentioned, ammonia manufacturing costs.

The project envisages increasing ammonia capacity by 50,000 tpy; urea production - by 30,000 tpy, to 300,000 tonnes; ammonium nitrate capacity - by 62,000 tpy and nitric acid manufacture – by 50,000 tpy.

Natural gas consumption per one tonne of ammonia will be reduced by 20.3 Nm3, the total consumption of gas - by 81.2m Nm3 per year. Project execution will reduce electric energy consumption for production of one tonne of ammonia by 72 kWh and total power consumption will be cut by 28.4m kWh per year. These factors will allow the company to reduce costs of ammonia by 12.6% in 2015, thereby increasing competitiveness of the product.

In January 2014, Farg’onaazot repeatedly announced a tender for equipment procure-ment for USD 15.5mn. The tender was announced within the frames of a project for reconstructing the urea and ammonia workshops. First, the USD 18.8m tender was planned to be held in June 2013 and the results were to be announced in the Q3 of 2013. However, it was not held due to lack of competitive bids.

The project involves spending USD 16.3m of the company’s own funds in the coming years. In addition, it will be financed at the cost of the Fund for Reconstruction and Development of Uzbekistan for USD 24m and cost of Uzbek banks for USD 22m.

Ammofos-Maxam JSC

Ammofos-Maxam JSC (Olmaliq, Toshkent province) is one of the largest companies in Uzbekistan. It was launched in 1969. Today the plant manufactures complex N-P fertilis-ers on the basis of phosphorite of the Kyzyl Kum deposit. The company is a member of O’zkimyosanoat SJC. In 2009, 49% of the company’s shares were sold to a foreign investor – a Spanish corporation Maxam.

The production site of Ammofos-Maxam is located at the foot of the Kurama Range, 60 km from Toshkent and 7 km from Olmaliq occupying 194.5 hectares.

The plant has two workshops for ammophos, two phosphoric acid workshops, sulphuric acid production, production of con-sumer goods and a number of auxiliary facili-ties. Installed capacity of Ammofos-Maxam for phosphate fertilisers is 217,500 tonnes

(100% P2O5 per year) and for sulphuric acid (monohydrate) – 500,000 tonnes.

The main products of the company are: ammophos containing monoammonium phosphate NH4H2PO4 with an admixture of diammonium phosphate (NH4)2HPO4), ammonium-phosphate-sulfate containing monoammonium phosphate (NH4H2PO4) and ammonium sulphate (NH4)SO4, NP 15:23), suprephos -NS (a mixture of CaHPO4, (NH4)2SO4, NN4N2RO4, (NH4)2N2RO4 and from 0.5-2% of Mg salts of four grades with a total content of active substances of 80-90%), monoammonium phosphate (NP 12:52), ammonium sulphate (granulated, for alkaline soils), sulphuric acid (improved; first and second grades), sulphuric electrolyte for batteries (32-35% H2SO4), orthophosphoric acid (four grades - from 18% to 31% P2O5), phosphogypsum for soil improvement (three grades a with CaSO4 • 2H2O content of from 80% to 90%, and hygroscopic moisture 15-25%), feed ammonium phosphates of A and B grades (monoammonium NN4N2RO4 with low and controlled content of As, Pb and F), ground sulphur (for agricultural use), sodium biphosphate (NaH2PO4 with moisture content of 20.5%, application areas - refining of metals, water treatment, an auxiliary agent in the dyeing of textiles, a buffer in solutions for electroplating); mono disodium phos-phate, a mixture of NaH2PO4 and Na2HPO4 with a moisture content up to 23%), disodium phosphate (Na2HPO4 with a moisture content of up to 25%; application fields - boiler water treatment, production of glazes for pottery and porcelain, enamel manufacture, tin plat-ing, tanning, a reagent for electroforming (galvanoplastic processes, production of pigments in the textile industry); trisodium phosphate (Na3PO4, there are two grades - with a moisture content of 15% and 45%, it is used for water treatment and softening, and as cleaning and degreasing agents).

In addition, the Olmaliq company pro-duces fiberboards from cotton stalks and plant fibres. Its products are in great demand both in the domestic and foreign markets. The fertilisers are used in different climatic



zones and for various soil types for all kinds of crops, thanks to the balanced composition of nutrients. The company is certified under ISO 9001 QMS standards. It cooperates with the research and development institutes of Uzbekistan and the Russian Federation.

The main raw material is burnt phospho-rus concentrate, which is supplied by the Kyzyl Kum phosphorite complex. Muborak Gazni Qayta İshlash Zavodi (Muborak, Qashqadaryo province) supplies sulphur and Maxam-Chirchiq JSC (Chirchiq, Toshkent province) – ammonia.

Maxam-Chirchiq

This company was the first one in Central Asia to produce nitrogen fertilisers. In 1932 it was decided to build Chirchiq nitrogen fer-tiliser plant in the Toshkent province. Since its commissioning in 1940, the company bore the name Chirchiq electrochemical plant.

In the beginning it was specialised in production of nitrogen fertilisers by the fixation of nitrogen via electrical arc. Due to the development of deposits of natural gas in the Buxoro province, the company began to use natural gas supplied by pipe-lines to Chirchiq.

Using natural gas doubled the output and significantly reduced products costs. In 1975 the company was renamed Elektrokhimprom Production Association. In 2002, in accord-ance with a state programme for denation-alisation and privatisation Elektrokhimprom was transformed into Elektrkimyosanoat JSC.

In 2007, Spanish company Maxam pur-chased 49% of the company’s stock of shares. In this regard, the company was renamed Maxam-Chirchiq JSC. O’zkimyosanoat SJC has 51% of the shares.

The products of the company can be divided into 4 groups: mineral fertilisers, chemicals, resins and catalysts.

The range of fertilisers, produced in Chirchiq is the widest in Uzbekistan. This group includes carbamide, ammonium nitrate, ammonium sulphate and 9 other types of fertilisers and one pesticide. A mixed highly concentrated granular nitrogen-phosphorus fertiliser (NPF) is obtained by mechanical mixing ammonium nitrate with ammophos in the ratio 9:1.

High phosphorus content helps to increase plant resistance to unfavorable environmen-tal factors (drought and frost), and increases the resistance of plants to diseases, promotes

the accumulation of sugars in root vegetables and fruit. UAN is a new type of nitrogen fertilisers produced by the company contain-ing carbamide (30%) and ammonium nitrate (40%).

All-in-one nutrient solutions based on ammonium nitrate solution - is a liquid com-plex fertiliser prepared by mixing ammonium nitrate, monoammonium phosphate and potassium chloride.

All-in-one nutrient solution is a liquid compound fertiliser obtained by mixing carbamide-ammonia mixture, ammophos and potassium chloride. The fertiliser mix-ture manufactured by Maxam-Chirchiq is used for pre-sowing application, pre-sowing seed treatment and foliar feeding of plants by spraying them in greenhouses and on the open ground.

Technical magnesium sulphate improves crop yields due to the formation of car-bohydrates and promotes fruit formation. Phosphourea is a mixed fertiliser produced

by mechanical mixing of urea and ammophos. It is particularly useful for neu-tral and acidic soils. Another type of ferti-liser, urea sulphate, is derived by mixing urea and ammonium sulphate. Potassium sulphate produced in Chirchiq is a highly concentrated potassium fertiliser with a minimum 48% potassium content.

Sodium nitrate is a nitrogen fertiliser con-taining 16% of nitrogen. It is meant for soils of all types potatoes, beet-root, other vari-ous vegetables, fruit and decorative plants. Lime-sulphur spray is a product designed for crops affected by powdery mildew, red spi-der, anthracnose and other fungal diseases. Lime-sulphur spray can also be used for other industrial purposes. It is produced from tech-nical sulphur, limestone and water.

The product line of fertilisers is extremely diverse both in terms of chemical composition and application areas. So, in addition to ammo-nium nitrate of agricultural application three varieties of NH4NO3 are produced in Chirchiq.

Ammonium nitrate of low density is used for commercial purposes; ammonium nitrate

Panorama of Maxam-Chirchiq



without conditioners for technical applica-tion is produced exclusively for the needs of foreign customers. And ammonium nitrate solution is purchased by companies manu-facturing industrial explosives.

The company produces 4 types of HNO3: nitric acid (56%) of reactive grade (used in the electronics and medicine industries), nitric acid for special purposes (designed for the electronic and metallurgical industries), weak nitric acid (for production of ammo-nium nitrate, complex fertilisers and metal etching), and concentrated nitric acid of A and B grades.

Grade A is used in the electronic and radio electronic industries, for nitration of organic compounds in manufacture of explosives, chemical treatment of metals, in the medical industry and plastics manufacture. Grade B is applied for galvanic processes, in produc-tion of chemical reagents, for dissolving chemicals impurities, in processes of nitra-tion of organic compounds in manufacture of explosives.

Technical aqueous ammonia of reactive grade as well as liquid ammonia of three grades (A, B, and Ak) is produced on the basis of NH3 synthesised in Chirchiq. Ammonium carbonate (Ak grade) is a mixture of ammo-nium carbonate and bicarbonate intended for synthesis of ammonium sulphate.

Industrial gases occupy an important place in the product range of Maxam-Chirchiq. Technical hydrogen is used in the electronics, chemical, pharmaceutical industries, in fer-rous metallurgy and in the communications and energy industries.

Solid carbon dioxide is used for cooling in refrigeration equipment, processing, storage, transportation and sale of frozen and chilled foods by direct or indirect contact with them. Gaseous and liquefied carbon dioxide is used to create protective environment for welding of metals; for food processing in manufac-ture of carbonated drinks, dry ice, for cool-ing, freezing and storing food in direct and indirect contact with them; for drying casting moulds; for fire extinguishing.

Gaseous oxygen is used for welding non-ferrous metals, light-weight alloys and intensifying metallurgical processes. Liquid oxygen is a by-product of manufacturing liquid nitrogen from atmospheric air by low-temperature rectification. It is applied after gasification for flame treatment of metals and other industrial purposes.

Gaseous nitrogen is intended to create an inert atmosphere during production of easily oxidizable products, high-temperature pro-cessing of metals, which do not interact with nitrogen, for preserving closed metal vessels and pipelines. Liquid nitrogen is derived from atmospheric air by deep cooling and it is used by agricultural companies as a refrig-erant. Chemists in Chirchiq produce two types of urea-formaldehyde resins (COP -11 and KFZH), similar to those by Navoiyazot JSC (see above).

The plant produces a number of important industrial catalysts. Thus, for ammonia syn-thesis catalysts CA-C (oxidized) and CA-CB (reduced) are designed to operate at tempera-tures from 400 °C to 600 °C at pressure from 15 MPa to 55 MPa. Nickel catalyst GIAP-8 is designed for steam, air and vapour carbon-dioxide conversion of gaseous hydrocarbons to produce commercial hydrogen and various industrial gases.

Chrome-alumina catalyst GIAP-14 is meant for loading in the upper zone of second stage shaft reactors for air-steam conversion of natu-ral gas under pressure of 4 MPa. Methanation catalyst TS-2 is designed to purify a mixture of nitric oxides from carbon oxide. Catalysts UCC-02, UCC-02E are applied for the process of conversion of carbon oxide with steam under pressure of 5 MPa and at temperatures from 320 °C to 350 °C.

Low temperature methanation catalyst for carbon oxide conversion NTK-4U is used for catalytic processes in carbon oxide conver-sion with water vapour in ammonia produc-tion. It contains primarily metal oxides and produced in the form of cylindrical pellets. Aluminium nickel molybdenum catalyst CGI-09 is manufactured for intraplant con-

sumption for hydrogenation of sulphur com-pounds from hydrocarbons in production of ammonia.

Sulphur absorbent NPV-03 is manufac-tured at the existing equipment for produc-tion of catalyst GIAP-8 from zinc oxide, which is derived from spent catalysts (zinc sinks) GIAP-10.

The main raw materials consumed by Maxam-Chirchiq are: natural gas, caustic soda, sulphur, hydrochloric acid, formaline, methanol and monoethanol amine.

The main consumers of the local plant are agro-industrial companies and farms, chemi-cal and other industries. Major importers are Russia, Kazakhstan, Tajikistan, Afghanistan, Turkmenistan, Kyrgyzstan, China, Iran and Turkey.

Qo’qon superfosfat zavodi

Qo’qon superfosfat zavodi JSC (Qo’qon Superphosphate Plant, Qo’qon, Farg’ona province) is one of the oldest companies in the country for production of phosphate ferti-lisers. It employs 500 workers.

The plant was built on the basis of a bulk blending plant, which was part of People’s Commissariat of Heavy Industry of the USSR GlavAzot, and it was put into operation in 1935. The initial product range included organo-mineral fertiliser mixtures. In wartime, the factory manufactured defense products. In 1942-1945 the plant produced explosive “Dinamon Zh”.

In 1941, construction of a superphos-phate plant started using the equipment delivered from Nevsky (St. Petersburg) and Voskresensky (Moscow region) chemical fertiliser plants. The first stage of the plant started up in 1946. Apatite and imported sulphuric acid were raw materials for super-phosphate production. At the same time the construction of a sulphuric acid plant started and it was completed in 1947.

After discovering the Karatau phospho-rite basin, the plant mastered a technology for production of superphosphate from the



deposit. In 1949, designing and constructing a new superphosphate plant with a design capacity of 42 tonnes per year (in terms of 100% P2O5) started, and in 1958 the plant was put into operation. In 1956, the sulphuric acid plant was reconstructed and its capacity was increased due to the growing output of superphosphate.

In 1953, a pilot plant was installed and production of ammoniated superphosphate started up. At the same time construction of an ammoniated superphosphate plant with a designed capacity of 45,500 tonnes per year (in terms of 100% of P2O5), began. In 1962, the plant was put into operation.

In 1964 a technology for producing ammoniated superphosphate by a new flow sheet was introduced – ‘ammonation - dry-ing - sieving – crushing’. In 1967, two more drum ammonation units were installed. In 1971, the reconstruction of the drying plant was made. Battery cyclones were replaced with cyclones with a self-cleaning device. In 1973, two additional screens GIL-52 were integrated into the process flow sheet.

Since 1998 with the commissioning the Kyzyl Kum phosphorite plant, Qo’qon superfosfat zavodi started processing local raw materials - raw phosphorites from the Tashkura deposit. In 1999, Chirchiq leading research institute O’zkimyosanoatLoyiha (Uzbek chemical industrial projects) estab-lished ammoniated superphosphate capacity at 178,000 tonnes per year in physical terms during the transition to phosphate raw mate-rial from the central Kyzyl Kum.

In 2004, the first stage of reconstruction including drying, grading and packaging of fertilisers was completed at Qo’qon superfos-fat zavodi JSC.

In 2008, Russian company Monolith LLC (Moscow) became the owner of 85.2% of the company’s shares, paying for them approxi-mately USD 3.6m to State Property Fund of Uzbekistan (SPF). In 2011, this deal was cancelled by mutual consent. Investment commitments of the Russian company at closing the deal were USD 5m, which had to

be implemented within 5 years. The volume of investments accounted for about USD 3m before the cancellation of the contract.

As for the structure of the share capital of the company, 85.2% of the shares have been returned to the SPF, 10% are the share of the labour collective and the rest 4.8% belong to other minority shareholders (companies and natural people).

In 2010, as a result of series of imple-mented innovative technical solutions, the capacity of the plant for ammoniated superphosphate reached 230,000 tonnes. Ammoniated superphosphate is the main product. The nutrient content of the fer-tiliser is: P2O5 - 13 ± 1%, nitrogen in ammonium form - 1,5 ± 0,5%. It is used in agriculture for growing different crops - vegetables, fruit and both technical and decorative plants. Ammoniated super-phosphate is recommended for using in conjunction with potassium fertilisers. It is sold to consumers at USD 90 per tonne (bulk) by railway or in consumer’s bags (50 kg bags) by the buyer FCA (railway station Qo’qon -1).

The main consumers of ammoniated superphosphate are agricultural companies, which are mainly located in the Farg’ona, Andijon and Namangan provinces. The fer-tiliser is in demand in the neighboring coun-tries, particularly in Tajikistan, Kazakhstan and Kyrgyzstan; it is also shipped to Iran and Afghanistan from time to time.

The export potential of producers of ammoniated superphosphate is increasing from year to year. If the volume of exports in 2005 amounted to 900 tonnes, in 2009 it was 19,300 tonnes, and during the last years it has been at the level of 30,000-32,000 tonnes.

The main types of process feedstock come from the local market. This is phosphorite meal, sulphuric acid and ammonia.

The company produces building gypsum and mineral fertilisers in small packaging for the domestic consumer market. The future plans of the company are: launching of pig-ment production with an annual capacity of

1,000 tonnes, and magnesium compounds with an annual capacity of 1,000 tonnes.

Samarqandkimyo

The plant was founded in 1949. In 1950, according to a project of the USSR Giprokhim the construction of sulphate, superphosphate, oxygen and mechanical repair and engineering workshops was started. A network of access roads, which included two railway stations and two auxiliary stations (Superfosfatnaya and Zavodskaya) was built. The main focus of the plant was phosphorus-containing min-eral fertilisers of superphosphate type for the needs of the cotton-growing republics of Central Asia. The phosphorite deposit in Karatau (Dzhambul region, Kazakhstan) was the raw material base.

A workshop for production of sulphuric acid by contact process with the main appara-tus located out of specialised industrial prem-ises was built in the USSR at the Samarqand superphosphate factory. The experience of the Samarqand plant showed that under conditions of careful development of manu-facturing processes and maintenance, equip-ment of sulphuric acid plants can be used in the open area, which significantly reduces the capital cost of construction of workshops and equipment installation; makes it easier to install ventilation, remove harmful gases and excessive heat.

Planned output of sulphuric acid, which is needed to produce mineral fertilisers, started in 1954.

In 1955, a superphosphate workshop began operating. However, the fertiliser produced from phosphate of the Karatau deposit had poor physical properties, which made their soil application difficult. In order to improve the properties of simple superphosphate, construction of a granulation workshop was started, and it was completed in 1960.

A little earlier, a unit for production of bat-tery acid and selenite sludge was installed. In 1962 the plant started production of ammoni-ated superphosphate. The output of concen-



trated and complex fertilisers was growing quickly. The most important type of fertiliser was ammophos, and its production started in 1976. In 1978, ammophos was awarded the State Quality Mark.

In 1984, a plant for extraction phosphoric acid of the third stage was put into opera-tion. The capacity of the plant was 136,400 tonnes per year. In 1994, due to cessation of deliveries of phosphate raw materials from Kazakhstan, the second stage of the plant was switched to production of granulated ammo-nium sulphate.

Since 1994, a new technology for produc-tion of fertilisers based on the processing of local raw materials was developed on the basis of the second of the plant.

In 2004, specialists of the company and Design Institute O’zkimyosanoatLoyiha developed a new kind of fertiliser - NPF (nitrogen-phosphorus fertiliser).

In 2005, by order of the State Property Committee of Uzbekistan, the company became an open joint-stock company and was renamed Samarqandkimyo JSC. Currently the company employs over 800 people. Unfortunately, in recent years Samarqandkimyo has been unprofitable. In this regard, in January 2014, the Cabinet of Ministers, the Ministry of Economy, the Ministry of Finance with the involvement of stakeholders had to develop and adopt a programme for tackling financial crisis and actual bankruptcy of some industrial compa-nies in a three-month period.

Now the product range of the plant includes N-P-Ca (nitrofos), N-P-K (nitrophoska) and suspended liquid phosphorus-containing nitre.

Complex fertiliser N-P-Ca (nitrofos) con-tains 6% of nitrogen, 16% of phosphorus and 11% of calcium. Nitrogen regulates the growth of vegetative mass and determines the level of productivity. Phosphorus acti-vates root growth, accelerates the develop-ment of all processes and increases winter hardiness. Calcium stimulates plant growth and root development, increases metabolism,

activates enzymes and strengthens the cell walls.

The efficiency of this complex fertiliser has been proven at several Uzbek farms. Studies have shown that it has a positive effect on plant growth and development, thereby increasing the crop yield by 17-20% on aver-age. It is recommended for cereals crops, cucurbits crops, cotton and forage crops, fruit and berry crops, vegetables as well as houseplants. N-P-Ca should be used as a base fertiliser before sowing and as a plant food throughout the growing season.

All its components are well absorbed by plants in neutral carbonate-containing soils, even highly saline soils of the Central Asian region, and in all other types including black soil.

N-P-K (nitrophoska) is a highly effective mineral fertiliser, which contains the basic nutrients needed for plant growth - nitro-gen, phosphorus, potassium and calcium (N - 5%, P2O5 - 14%, K2O - 14% and CaO - 12%) – in the available form. The tech-nology of production of this fertiliser was mastered at the plant not that long ago - after the company Dehqonobod Kaliyli O’g’itlar Zavodi (Dehqonobod Potash Fertiliser Plant) started manufacture of crystalline potassium chloride.

Potassium is one of the most important nutrients for plants. It keeps and retains water in stems and leaves, enhances the formation of sugars; it increases the resistance of plants to disease, drought and frost.

N-P-K (nitrophoska) is produced by mix-ing nitrophosphate pulp and crystalline KCl. The technology for producing N-P-K fertilisers has been developed by specialists of Samarqandkimyo JSC. Complex mineral fertiliser ZHSFS (suspended liquid phospho-rus-containing nitrate) contains nitrogen (7% N), phosphorus (7% P2O5) and water-soluble calcium (7% CaO). It is manufactured by mixing calcium nitrate-phosphate pulp with ammonium nitrate solution.

The solution is used in agriculture to feed all kinds of crops throughout the period of their vegetation. According to test results of the Uzbek Research Institute of Cotton in conjunction with the Institute of General and Inorganic Chemistry of the Academy of Sciences of Uzbekistan recommenda-tions for its use in agriculture have been developed.

ZHSFS is used for foliar application by spraying the suspension solution onto leaves, and for root nutrition during the formation of leaves, during budding and blooming periods. These methods of appli-

Production facilities at Samarqandkimyo plant



cation stimulate growth and development of crops, and also serve as means of protec-tion from diseases.

Beside the main products – fertilisers - the plant manufactures battery sulphuric acid. The main importers of plant products are: Tajikistan, Afghanistan, Kyrgyzstan and Iran. The basic raw materials required for produc-tion are phosphorite meal and nitric acid.

Dehqonobod Kaliyli O’g’itlar Zavodi Unitary Enterprise

The construction of Dehqonobod potash fertiliser plant on the basis of the Tubegatan sylvite deposit in the Qashqadaryo province started in 2007. In 2008, O’zkimyosanoat SJC concluded contracts with ZUMK (ZAO UK Western-Ural Machine Building Concern CJSC Management Company; Perm) and CITIC Pacific Ltd. (China) for building on a turnkey basis; with the Russian company - to build a mining complex; with the Chinese - for the construction of a processing complex.

The first tonne of sylvite mined by Tubegatan potash mine group (TPMG) was processed at the plant in December 2009. And in mid-2010 the plant at the cost of USD 123.7m and with capacity of 200,000 tonnes of potash per year was put into commercial

operation. In 2010, the company produced 55,000 tonnes of potassium chloride; in 2011 – 180,000 tonnes, and in 2012 reached its design capacity. Construction of the second stage of the plant at the cost of USD 254.5m provides an increase of the capacity of the plant by three times - up to 600,000 tonnes of potash fertilisers per year, and about 350,000 tonnes will be exported.

In 2011, ZUMK signed a contract with O’zkimyosanoat to expand capacity of the production complex worth USD 128m, and with CITIC Ltd - to expand capacity of the pro-cessing complex at the cost of USD 110m. The construction started in late 2011 and in the mid-2014 production should be put into operation.

USD 110.5m from Export and Import Bank of China, O’zkimyosanoat’s own finances and credits of the Fund for Reconstruction and Development of Uzbekistan in the amount USD 128.1m were allocated for the project. The payback period from the begin-ning of construction is 7.5 years. The number of created jobs is 944. Potassium chloride according to State Standard GOST 4568-95 produced by the plant is shipped to local farmers, factories producing complex min-eral fertilisers, as well as abroad - Sri Lanka, UAE, Iran, Kazakhstan, Georgia, Vietnam, Malaysia and China.

JV Elektrokimyozavod

JV Elektrokimyozavod CJSC (Navoiy) electrochemical plant was founded in 1971 for production of chemical crop protec-tion products: insectoacaricides, herbi-cides and fungicides for Central Asia and other former Soviet republics. The second birth of the company was the creation of the Uzbek-Panamanian joint venture, Elektrokimyozavod JSC, in 1994.

After the plant became a joint-stock com-pany, it took a course on production of chem-ical crop protection agents from imported active ingredients and components from local raw materials. Economic expediency of the plant, which would allow the country to save up to one third of the currency for pur-chasing finished crop protection agents, was taken into consideration. To expand the range of products and to improve their quality, a reconstruction of basic workshops was car-ried out, modern technology and packaging equipment was purchased, as well as modern analytical equipment.

The company used to produce only four kinds of products but today the range of products includes more than 60 articles. Some are manufactured under licenses of the following companies: Dalston Associated (Panama), Syngenta (Switzerland), BASF (Germany), FMC (USA), Keminova Agro (Denmark), United Phosphorus (India) August JSC (Russia), Schyolkovo Agrochim JSC (Russia) using brands of the companies.

Products quality fully meets the require-ments of the licensors. For using at house-hold plots, fertilisers are available in small packaging. Production of veterinary drugs for controlling parasites for animals and poultry, as well as drugs for use as disinfectants, disinsectants and exterminating substances was launched.

However, today the company’s economy is based on production from local raw materi-als. Manufacture of some products such as chemical crop protection agents and simple superphosphate is included in the Republican

Dehqonobod potash fertiliser plant



programme of localisation of finished prod-ucts, components and materials on the basis of local raw materials. In the new economic environment, the company confidently took a leading position in production of chemi-cal plant protection products not only in Uzbekistan, but in all Central Asia.

Let’s review the company products in detail. The herbicidal group includes Estamp (emul-sion concentrate containing 330 g/l of active substance pendimethalin пендиметалина - 2,6-Dinitro-N-(1-ethylpropyl) -3,4-xylidine; pre-emergence herbicide of a broad-spectrum designed for combating annual cereal and dicotyledonous weeds at arable farmlands).

Dalstar (dry flowable suspension, con-taining 750 g/kg of the active ingredient tribenuron methyl – (methyl-2-[4-methoxy-6-methyl-1,3,5.triazin-2-yl(methyl) carbo-moylsulfomoyl] benzoate); it is used in small doses as a highly effective postemergence herbicide for fighting broadleaf weeds in winter and spring grain crops) and Dalzlak Extra (emulsion concentrate, containing 104 g/l of active substance haloxyfop-(P-methyl - methyl (R)-2-{4-[3-chloride-5-(tri fluoromethyl)-2-pyridyloxy]phenoxy}propi-onate; the postemergence systemic herbicide designed to control annual and perennial gramineous weeds in cotton sowing).

The group of insectoacaricides includes Esfen Alpha (emulsion concentrate containing 5% and 20% esfenvalerate - A, α-fenvalerate-(S)-3-methyl-2-(4-chlorophenyl)-butyric acid (S)-α-cyano -3-phenoxybenzyl ester; it has contact and enteral damage effects on insects and worms), Tsiraks (25% emulsion concentrate cypermethrin - (R, S)-a-cyano-3-phenoxybenzyl (1RS)-cis-trance-3-(2,2-di vinyl chloride)-2,2-dimethyl cyclopropane carboxylate, which has contact and enteral damage effects),

Karbofos (emulsion concentrate, contain-ing 50% of malathion - organophosphorus compound, which has contact partly fumi-gant effects on insects and ticks) and Dalprid (water soluble concentrate containing 200 g/l of imidacloprid - 4,5-dihydro-N-nitro-1-[(6-

chloride-3-pyridyl)-methyl]-imideazolidine-2-ilene-amine; it is intended for cotton and wheat against sucking insects).

The group of protectants includes Tebu (microemulsion containing 60 g/l of tebucon-azole - (RS)-1р-chlorophenyl-4,4-dimethyl-3-(1H-1,2,4-triazole-1-il-methyl)pental-3-il; it is used for pre-sowing treatment of grain), Daltebu (water soluble suspension, contain-ing 6% of tebuconazole; it is applied for pre-sowing treatment of grain); Dalucho (wettable powder, containing 70% of imida-cloprid; it is applied against insects that feed on moisture of plants and infect seed stocks) and Dalbron (an active ingredient - Bronopol, or 2-bromo-2-nitropropane-1,3-diol; it enhances the ability of seeds for germination. Its application increases cotton crop by 5-6 centners per hectare.

The company produces two veterinary drugs - Cypermethrin (25% emulsion con-centrate of pyrethroid cypermethrin; it is used to combat leaf-eating insects) and Tsiperfos (emulsion concentrate containing two active substances - 5% of cypermethrin and 50% of chlorpyrifos - 0.0 - diethyl- 0 -( 3,5,6 - trichloro -2- pyridyl) phosphothioate; it is used for combating leaf-eating insects and psyllas, suppresses and prevents from ticks).

Rodenticides are presented by Zookumarin (sodium salt compound of technical warfarin, 4- hydroxy -3 -(3 - oxo -1- phenylbutyl) cou-marin; it is used for deratisation).

Growth-regulating chemicals, which are manufactured in Navoiy, include Uzrep and Dalrost (aqueous solution containing 720 g/l of ethephon - 2-chloroethylphos-phonic acid; it accelerates plant growth and ripening of cotton) and Dalpiksi (5% aqueous solution of mepiquat chloride - N, N-dimethylpiperidinium), which accelerates ripening cotton bolls).

Extra Avguron (a suspension concentrate containing two active components - 360 g/l of tidiazuron - 3 - (1,2,3-Tiadiazolin-5)-1-phenyl-urea and 180 g/l of diuron - 3 - (3,4-dichlorophenyl) -1,1-dimethylurea) -

the only defoliant for cotton, which is manu-factured by the company and applied before harvesting.

In 2003, after development work, the construction of simple superphosphate pro-duction was started, and in 2004 the first processing line was launched. Since 2007, simple superphosphate is also available in granular form.

Experience has shown that using poor phosphate of the Tashkura deposit and sul-phuric acid of the Uchkuduk deposit as raw materials allows manufacturing mineral fer-tilisers of high quality. That is why Navoiy superphosphate is in high demand not only among local farmers, but it is also exported abroad.

An important step towards improving the economic performance of the company was re-starting previously mothballed capac-ity. Production of sodium sulphide ethyl acetate and sodium chloride was launched at idled capacity. A subsidiary company Eltuz was established specially for production of sodium chloride. It should be mentioned that iodised salt of the highest quality, produced under the brand name JP, is known through-out the country. Each month, 500 tonnes of edible salt are shipped to consumers. Quality management system of the company was cer-tified in 2007 according to the international standard ISO 9001:2000.

Maxam-Uzbekistan JV

Uzbek-Spanish company, which employs more than 40 people, is located in Olmaliq (Toshkent province) and produces industrial explosives “Manfo-8, 7.” It is a mixture of ammonium nitrate, diesel fuel, fuel oil and aluminum powder. Its main customers are domestic mining companies.

Qo’ngirot Soda Zavodi Unitary Enterprise

Unitary Enterprise Qo’ngirot Soda Zavodi (Qo’ngirot Soda Plant, located in the vil-



lage Elobod in the north of the country, in Qaraqalpaqstan Respublikasi’ is the only company producing soda ash on the territory of Central Asia.

The plant was founded in 1995. However, it was a difficult task to build a modern chemical company in the desert. It was nec-essary to build a 40 km road to the deposit of sodium chloride; to provide electric power supply, natural gas and water; to create normal conditions for personnel. Later, the main production units of the plant were built – workshops of sodium bicarbonate, calcina-tion, lime burning and slaking, purification of salt solutions, technical and aqueous support, as well as a boiler station.

Some ancillary facilities were built: a motor pool, a testing area for reinforce con-crete products, mechanical repair shops, a compressor station, an administrative and amenity building and a fire station. Most of the installed equipment was manufactured in China, and some was delivered from the United States, Italy and Germany. The plant, which currently employs 1,360 people, was commissioned in 2006 by a Chinese com-pany CITIC Pacific Ltd and O’zkimyosanoat SJC.

Total project cost was USD 100m. The company CITIC Pacific Ltd, according to the contract, carried out the turnkey design and

installation of process equipment of the plant at the cost of USD 32.3m. The technological part of the project was funded on account of a loan from the Industrial and Commercial Bank of China under insurance cover of China Corporation of export-credit insurance (90% of the contract value) and on account of a loan from Uzpromstroybank (10% of the contract value) under the guarantee of the government.

General construction works were car-ried out by local construction companies at expenses of O’zkimyosanoat. Its designed capacity is 100 tonnes of soda ash per year. The main raw materials for soda ash produc-tion are sodium chloride and calcium carbon-ate (limestone). All major raw materials are mined in Uzbekistan and they have been described above.

According to a conclusion of geologists, the rational use of underground resources of the Ustyurt plateau can ensure the needs of the plant for over the next 100 years. O’zkimyosanoat, Maxam-Chirchiq and Navoiyazot supply ammonia – another raw material.

In 2006, the factory produced 12,810 tonnes of soda ash, and in 2011 this figure increased sevenfold. In 2012 more than 92,000 tonnes of soda ash were produced, and in 2013 - about 102,000 tonnes.

Commissioning the plant allowed to refuse from imports of soda ash from Russia and Ukraine.

The plant’s products are demanded by the light industry, production of detergents, glass, paper and cellulose, the non-ferrous industry and other sectors of the Uzbek economy, which consume about 80% of soda ash.

Quvasoy glass factory is the main cus-tomers. Furthermore, sodium carbonate is exported to foreign consumers, mainly to Kazakhstan, Russia and Turkey. Over the last three years, the sales of the company’s products abroad rose fivefold. By the results of 2013, 22,000 tonnes of soda ash were shipped to foreign customers.

Due to increasing demand for soda ash in domestic and foreign markets, it was ruled to increase soda ash production of Qo’ngirot Soda Zavodi by more 100,000 tonnes by the presidential decree “On the priorities of industrial development of Uzbekistan for 2011-2015” dated 15 December, 2010. In April 2013, O’zkimyosanoat started con-structing the II stage of the plant. Increasing capacity of the plant up to 200,000 tonnes per year is one of the priorities of industrial development of Uzbekistan until 2015.

The start up of a production line for hyper pressed bricks is scheduled for the second half of 2014. Manufacture of new products from limestone should start in the mid-year, which will employ 65 people. By the end of 2015 it is planned to commission a glass containers unit.

Jizzax plastmassa

Jizzax plastmassa JSC (Jizzax) is the largest producer of films, pipes and consumer goods from high and low pressure polyethylene in Central Asia. The plant was commissioned in 1972. Its capacity is about 60% of total capac-ity of polymer producers in Uzbekistan. Jizzax plastmassa manufactured 18,200 tonnes of PE film per year, 10,800 tonnes of polyethylene pipes 315-630 mm in diameter, and 1,370 tonnes of consumer goods (fittings).

Qo’ngirot Soda Plant



Pipes produced in Jizzax are used for utili-ties, installation of hot and cold water supply networks and gasification, and that is why these products are practically not affected by seasonal decline in consumption.

The company has a modern unit for PE films and pipes, injection moulding equip-ment, and equipment for packaging manu-facture, as well as several crushing machines, which are used for recycling plastic waste. Number of workers employed at the plant - 439.

Shortan Gas Chemical Complex, which was put into operation in 2001 and produces 125,000 tonnes of polyethylene per year, sup-plies raw materials to Jizzax.

The main local consumers are: the agri-cultural sector, farms, private firms and con-struction companies. The main importers of products are Kazakhstan and Tajikistan.

Unfortunately, over the years, the company has been in a financial crisis. In this regard, the President of Uzbekistan Islam Karimov in January 2014 instructed the government to develop and adopt a “roadmap”, which would allow the company to avoid bankruptcy (by the way, most of the shares of Jizzax plast-massa still belong to the state).

III. Other chemical companies

Petrochemical companies

O’zneftgazqazibchiqarish (Uzneftegazdo-bycha) includes the largest companies of Uzbekistan for oil production, natural gas and condensate recovery and natural gas process-ing: Muborakneftgaz USE, Sho’rtanneftgaz USE, Andijonneft JSC, Jarqo’rg’onneft JSC, Usturtgaz USE, Gazlineftgazqazibchiqarish USE, Sho’rtan Gaz Kimyo Majmuasi USE and Muborak Gazni Qayta İshlash Zavodi USE.

Companies of O’zneftgazqazibchiqarish produce commercial oil, natural gas (sup-plied via trunk pipelines), liquefied hydrocar-bon gas for municipal consumption, liquefied hydrocarbon gas for automobile transport,

stable gas condensate, commercial liquid and lump sulphur, commercial granulated sulphur, granulated polyethylene of vari-ous grades, polyethylene pipes and fittings, polyethylene film, parts for drip irrigation systems. Below we will describe only two companies that use chemical technology processes.

Muborak Gazni Qayta İshlash Zavodi USE

Muborak Gazni Qayta İshlash Zavodi (“Muborak Gas Processing Plant”, Muborak, Qashqadaryo region) is a pioneer in the field of processing of natural gas on the territory of Uzbekistan. Here, natural gas is converted into liquefied gas, gas condensate and other hydrocarbons. The company is one of the largest gas processing plants in the world. The plant was commissioned in 1971 and it is designed for annual processing 30bn m3 of gas.

The main processes of Muborak plant are absorption purification of natural gas, followed by low-temperature drying, com-mercial sulphur gas production by the Claus method and condensate stabilisation to obtain liquefied gas. In 2012, 27,65bn m3 of natural

gas were processed. Production of liquefied gas (propane-butane) reached 15,000 tonnes instead of the planned 8,500 tonnes.

The plant produced 298,400 tonnes of stable gas condensate and 347,800 tonnes of elemental sulphur, which was certified in 2007 according to the international qual-ity management system. For six months of 2013 the volume of liquefied gas production increased by almost 6.4 times, and gas con-densate – by almost 4.4 times, compared to the same period last year.

We mentioned the course for modernisa-tion of chemical production conducted by the national government. According to the course, a special programme for technical re-equipment at the plant was developed. In particular, in July 2013, three production lines of propane -butane mixture were put into operation. Construction of this large industrial facility is the result of the imple-mentation of an important investment project “Construction of a propane-butane mixture processing unit to increase production of liq-uefied gas at Muborak Gazni Qayta İshlash Zavodi USE” worth USD 244m.

Funding for the project was provided by O’zbekneftgaz proper, a loan of Fund for Reconstruction and Development of

Jizzax plastmassa is equipped mainly with Chinese is mainly equipped with Chinese machinery



Uzbekistan, as well as loans of the National Bank for Foreign Economic Activities and the China Development Bank. Construction of a new complex is also a result of coopera-tion of the leading companies from Russia, Ukraine, France, the USA, Poland and China.

Foreign manufacturers installed unique high-tech equipment. At the same time, most of it is made in Uzbekistan by special-ists of O’zbekkimyomash Zavodi JSC and Namanganmash JSC. The new unit, which is designed to strengthen the exports poten-tial of the industry, can process 12bn m3 of natural gas and produce up to 258,000 tonnes of liquefied gas and 125,000 tonnes of gas condensate per year.

In addition, taking into account decom-missioning of outdated installations, the construction of the seventh stage of des-ulfurisation consisting of three universal units with a total capacity of 6bn m3 of gas per year was completed. All the three units were put into operation in the period from August 2012 to March 2013. The absorp-tion system of the new units is equipped with modern contacting tip ‘Peton’ that gives the opportunity to save electricity, heat and absorbents, and to increase output of high-quality products by 20%.

Construction documents of the new units were prepared by the institute

O’zLITIneftgaz, construction and instal-lation works were carried out by local contractors, most of manufacturing equipment is produced in workshops of O’zbekkimyomash Zavodi. The advan-tage of the new equipment is the ability to process not 250,000 m3 but 300,000 m3 of natural gas per hour. USD 171.8m has been invested in this project. At the next step of modernisation of the plant, which will be implemented by the end of 2015, O’zbekneftgaz will gradually build the eighth stage of gas desulphurisation. USD 220m will be allocated from the funds of O’zbekneftgaz. The implementation of the project will ensure reliable operation of the system for purification of natural gas from hydrogen sulphide and acid gas in the long-term prospect.

Blocks of the new stages also allow solv-ing the problem of processing hydrocarbon raw materials supplied from the gas-bearing area Khausak -Shady in the Buxoro province, which is being developed by the Russian company Lukoil within the frames of a joint venture with Uzbekistan. In October 2013, the company Lukoil Uzbekistan started producing and transporting gas to Muborak Gazni Qayta İshlash Zavodi. It is planned to process and transport 2.2 bn m3 of gas per year. The implementation of the project will

enable Muborak Gazni Qayta İshlash Zavodi to increase operating rate, and employ 186 people.

In addition, by 2015 O’zbekneftgaz is planning to proceed to construction of a gas chemical complex on the basis of Muborak Gazni Qayta İshlash Zavodi. The project will be implemented by a 50:50 joint venture with Indorama Group (Singapore). It envisages production of 492,000 tonnes of polyeth-ylene, 66,000 tonnes of gas condensate and 53,000 tonnes of pyrolysis petrol per year. The construction period of the complex is three years.

The project initially estimated at USD 2.5bn, will be financed by funds raised by Indorama, a loan of the Fund for Reconstruction and Development of Uzbekistan and equity funds of O’zbekneftgaz.

Sho’rtan Gaz Kimyo Majmuasi

Sho’rtan Gaz Kimyo Majmuasi Unitary Daughter Enterprise (Shortan Gas Chemical Complex; Sho’rtan, Guzor district of Qashqadaryo province) is a perfect example of the “new way” of the economic devel-opment of Uzbekistan. Being a part of the USSR, Uzbekistan was mainly regarded as a source of cheap gas and cotton, but after declaration of independence, the country’s industrial production has been reoriented suf-ficiently to deep processing of raw materials close to their location. This is undoubtedly one of the most successful projects of the National Holding Company O’zbekneftgaz, which was carried out during the years of independence.

There was a need for construction of such a complex. Ten years ago, the country experienced a serious shortage of poly-ethylene, and consumers were completely dependent on imports from Russia, China and South Korea, and that required sig-nificant investments and increased plastic goods production costs.

However, a feedstock for manufacture of polyethylene - natural gas with a high con-



tent of light hydrocarbons (ethane, propane, butane and a relatively small amount of sul-phur) –was found in the Sho’rtan gas deposit (30% of all Uzbek gas) and in the South Tandyrcha, Adamtash and Gumbulak depos-its. In addition, the local gas condensate contains a significant content of aromatics - a valuable raw material for petrochemical synthesis.

After conducting necessary geological survey in November 1997, it was decided to build Sho’rtan Gaz Kimyo Majmuasi. The aim was to build a powerful plant for pro-cessing of 3.5bn m3 of gas per year by etha-nolamine method for production of 125,000 tonnes of polyethylene UzClear® in granules, 100,000 tonnes of liquefied gas, 100,000 tonnes of gas condensate and 1,500 tonnes of sulphur.

Sho’rtan complex became an example of successful international cooperation, as companies from the USA, Japan, Italy, Germany, Canada, France, South Korea and Russia participated in its financing, design, construction, training of staff, in addition to O’zbekneftgaz.

In 1998, O’zbekneftgaz signed a turnkey contract for design, equipment supply, con-struction, and commissioning on the basis of fixed price with an international consortium

consisting of globally renowned companies (ABB Lummus Global, Shell, Nissho Iwai, Mitsui, Toyo Engineering, Nova Chemicals). The project was financed by export-import banks of the USA and Japan, Germany-based Credit Agency Hermes, by the banks Chase Manhattan (USA) and Commerzbank (Germany).

The cost of the engineering aspect of the design was USD 656.6m. Besides foreign loans, an amount equivalent to USD 328m in the national currency of Uzbekistan was invested in the construction of the plant. The total investment exceeded USD 1bn.

In 2001, the construction was mostly completed, the plant was commissioned and the company started to approach the design capacity. In 2005, Sho’rtan Gaz Kimyo Majmuasi was successfully certified under ISO 9001:2000 QMS requirements.

We will briefly describe the production technology. Natural gas from the Sho’rtan field is fed to a separation unit after amine treatment and its deep processing with frac-tionation starts. ABB Lummus is a licensor of the gas separation technology and production of ethylene. Ethylene production consists of amine treatment plants, a gas separation plant with a chilling system, a block of pyrolysis gas preparation, pyrolysis furnaces, propane

and ethylene refrigerant systems and a unit for ethylene production.

Amine treatment is used for purification from acid components, and separated sour gas goes to a unit for sulphur production. Sulphur granulated and packed in bags of 25 kg is shipped to a warehouse for subsequent sale to consumers. Purified gas is supplied to a gas separation unit, from which pure methane, as a marketable gas, is sent to a gas transmission system. The main component, ethane, is converted at a cracker, where ethyl-ene is derived used in the further production of polyethylene.

It should be noted that liquefied natural gas produced at the company is extremely pure, since in the course of the manufacturing pro-cess each fraction (propane, butane) is sepa-rated to 99.99% purity and a part of propane is used as a refrigerant. Then these two com-ponents are mixed in the required proportions according to the existing standards. Propane-butane fraction, just like liquefied gas, is sold to consumers in tanks. Heavier fractions C5 +, which are derived while converting natural gas, are sent to refineries for further process-ing as gas condensates.

The main volume of ethylene is applied for production of polymers and the rest is converted at a dimerization unit into

Panorama of Shortan Gas Chemical Complex



Table 3. Polyethylene grades by Sho’rtan Gaz Kimyo Majmuasi

Grade and type of PE Density, g/cm3 ПТР, g/10 min Processing

typeRecommended applications

Value

Injection moulding grades

I-0754 HDPE 0,952 – 0,956 5,0 – 8,0

Injection moulding Household goods

I-0760 HDPE 0,958 – 0,962 5,5 – 8,5 General purpose

I-1561 HDPE 0,958 – 0,962 13,0 – 18,0For producing receptacles,

containers, boxes

I-2560 HDPE 0,958 – 0,962 20,0 – 30,0General purpose, receptacles,

containers

I-1625 LLDPE 0,922 – 0.928 12,0 – 20,0 Garbage containers

I-0525 LLDPE 0,923 – 0.927 4,0 – 6,0For low-capacity articles (caps,

artificial flowers)

Film grades

F-Y720 LLDPE 0,918 – 0,922 0,60 – 0,90 Extrusion Industrial packaging (thick film)

F-0120 LLDPE 0,918 – 0,922 0,80 – 1,50 General purpose film

F-0220 LLDPE 0,918 – 0,922 1,5 – 2,5 Ultrathin film (for mulching)

F-0320 LLDPE 0,918 – 0,922 2,5 – 3,5 Thin film (basic layer of stretch film)

F-Y336 MDPE 0,934 – 0,938 0,24 – 0,30 For films and bags

F-Y240 HDPE 0,936 – 0,942 0,19 – 0,31 For films and bags

F-Y346 HDPE 0,942 – 0,948 0,19 – 0,31 Rustling film and bags

Cable grades

WC-Y434 MDPE 0,932 – 0,936 0,30 – 0,46 Extrusion For cable and wire insulation

WC-Y734 MDPE 0,932 – 0,936 0,60 – 0,85For insulation of cables and rigid

hoses

Pipe grades

P-Y337 MDPE 0,936 – 0,940 0,21 – 0,33 Extrusion Basic grade for gas pipes

P-Y342 HDPE 0,940 – 0,944 0,24 – 0,36Piping, basic grade for high-pressure

pipelines

Р-Y456 HDPE 0,952 – 0,958 0,31 – 0,51 Large diameter pipes (drainage)

Blow moulding grades

B-Y250 HDPE 0,948 – 0,952 0,19 – 0,30 Blow moulding Cans

B-Y456 HDPE 0,954 – 0,958 0,33 – 0,43Blow moulding goods for general

purposes

B-Y460 HDPE 0,958 – 0,962 0,33 – 0,43Bottles for packaging and storing

liquids

Rotational grades

R-0333 MDPE 0,931 – 0,935 2,5 – 3,3Rotational moulding

For large-size articles (tanks, containers for agrochemicals, fuel)

R-0338 MDPE 0,935 – 0,940 2,0 – 3,0

R-0448 HDPE 0,946 – 0,950 3,1 – 4,1

Oriented grades

О-Y446 HDPE 0,944 – 0,948 0,33 – 0,43 Extrusion For tapes, monofilament for

industrial bags, oriented films



butene-1 – co-monomer for subsequent co-polymerisation for production of polyethyl-ene of medium and low density. Using the co-monomer allows one to change polyethylene density from 0.918 g/cm3 to 0.962 g/cm3.

The production process of the main prod-uct, polyethylene, takes place in a solution by liquid-phase technology Sclairtech (it ena-bles the company to quickly adjust the engi-neering process to manufacturing any of 148 varieties of polyethylene) under the license of Canadian company Nova Chemicals. The main advantage of this technology is the pos-sibility of varying the physical and chemical and rheological parameters of polyethylene using a serial mode of tubular and autoclave type reactors.

Thus, the company could produce linear polyethylene of various kinds at a single process line. The resulting polymer is com-pletely separated from the solvent, residual catalysts, purified from harmful substances and in the molten state, with the least con-tent of volatile compounds, is sent into the main extruder. All the necessary additives are added to the liquid or molten form, which ensures good mixing and complete homog-enization. Polyethylene produced by this technology can be used to manufacture any products, which contact with food and the human body without any harm.

After packing, polyethylene is sent to warehouses for storage and subsequent ship-ment to consumers by rail or road. Some part of polyethylene is used for production of plastic bags and pallets, which enables the company to package polyethylene on pallets in one tonne in 25 kg bags and to further store and ship it by any type of transport.

In 2006, Sho’rtan Gaz Kimyo Majmuasi took ownership under Qarshitermoplast (Uzbekistan, Qarshi), where, after installa-tion of extrusion equipment manufactured by Ermafa (Germany), gas - and water pipes and fittings with diameters from 25 mm to 250 mm for agriculture and municipal complexes were produced. Pipe grades of high density polyethylene are used as raw materials. In

2009, a production line for component parts of drip irrigation system was commissioned there. Since 2010, an extrusion line for pro-duction of polyethylene pipes in diameter from 315 mm to 630 mm has been operated. Over the past years, the plant produced more than 10,000 tonnes of finished products per year.

Today Sho’rtan Gaz Kimyo Majmuasi produces the lion share of the product range planned by the project: polyethylene (more than 70 % is exported to the EU, as well as to Turkey, China, Israel, Pakistan, Russia, Kazakhstan and Ukraine), liquefied gas (sup-plied to Iran and Afghanistan), sulphur and gas condensate. Sho’rtan polyethylene has shown itself to good advantage in extrusion processes and blow and rotational molding and injection molding machinery (see Table 3). All kinds of polyethylene produced by the plant have environmental and hygiene certifi-cates guaranteeing the safety of their use.

At the domestic market, the products of the Sho’rtan company are marketed through the Republican Commodity Exchange, which weekly trades in liquefied gas and polyethyl-ene in required amounts. It is to be stressed that the share of products sold at the domestic market increases from year to year. Initially, annual state order for cotton mulching film accounted for basic sales of polyethylene at the domestic market, whereas today this amount is less than one fifth of the total con-sumption of polyethylene at the internal mar-ket. Pipe, blown, cable, rotational and film polyethylene grades are in demand among consumers.

About 50% of polyethylene is exported to the EU countries (Italy, the Netherlands, Poland, Hungary, Lithuania and Latvia), Asia (Iran, Turkey, Pakistan and China), the CIS countries (Russia, Ukraine, Kazakhstan, Azerbaijan, Kyrgyzstan, Tajikistan).

Today, several directions of develop-ing the complex are considered. These are: increasing polyethylene production and synthesis of natural gas for manufacturing environmentally compatible synthetic fuels.

The development plan includes raising the amount and type of natural gas processing, use of methane, which is produced and sold today as a marketable gas and a feedstock for production of pure synthetic fuels (99.99%).

In September 2013, in Toshkent, there was held a conference of the main creditors of the project ‘Production of synthetic liquid fuels based on purified methane at Sho’rtan Gaz Kimyo Majmuasi’, also known as Oltin Yol GTL. It is expected that the first synthetic premium fuel will be produced in Uzbekistan in 2017. This will allow Uzbekistan to pro-vide fuel for its growing economy and simul-taneously reduce energy carriers imports.

Farg’ona neftni qayta ishlash zavodi

Unitary Daughter Company Farg’ona neftni qayta ishlash zavodi (Farg’ona refinery), subsidiary of O’zneftmahsulot (‘Uznefteproduct’), includes 35 process units for production of almost all range of oil products. The plant is one of the leading com-panies manufacturing fuels and lubricants in Central Asia with a feed capacity 5.5m tonnes of oil and gas condensate.

The development of the oil industry in the region dates back to 1868, when Russian industrialists made the first attempts to pro-duce oil in the Farg’ona Valley, but it was stopped for various reasons.

Oil wells with a flow rate sufficient for launching commercial oil refining were dis-covered only in 1904. The former Vannovskiy oil refinery (presently the Alty-Aryk refin-ery – a subsidiary of Farg’ona neftni qayta Unitary Daughter Enterprise) was put into operation in 1906. Presently, the Alty-Aryk refinery with a 3.2m tpy feed capacity spe-cialises in engine oil production.

The necessity to set up local oil processing and develop industry and transport in Central Asia on the whole forced the construction of a refinery in Farg’ona. The refinery also allowed for solving a task of bringing indus-try nearer to the sources of raw materials



and to consuming regions. Its trouble-free operations satisfied demand of Central Asia including Kazakhstan for oil products previ-ously delivered from faraway regions and excluded long-distant haulage and related excessive operating and capital expenditures. The date 27 January, 1959, when an atmos-pheric vacuum distillation plant AVT-1 – the first processing unit of the refinery – became operational, is regarded as a birthday of the Farg’ona refinery. Later, to increase oil con-version ratio, the following processing units were put into operation: 1) Primary oil and gas condensate processing plants of ELOU-AVT type (desalting and atmosphric vacuum distillation) – from 1959 to 1994; 2) Petrol catalytic reforming units – from 1965 to 1978; 3) An extraction azeotropic distillation unit – in 1964; 4) Plants for debituminisation of petroleum tar by propane – from 1960 to 1969; 5) Selective oil treatment plants – from 1960 to 1966; 6) Oil dewaxing plants – from 1961 to 1969; 7) A contact final oil treatment plant — in 1961; 8) An oil hydrofining plant — in 1966; 9) A vacuum distillation plant — in 1961; 10) A wax production unit — in

1964; 11) A bitumen production plant — in 1960; 12) Delayed coking units — from 1964 to 1975; 13) A petroleum coke calcination plant — in 1987; 14) An ethane unit — in 1968; 15) A high quality nitrogen production unit — in 1999.

Due to switching to a local feedstock with a high sulphur compound content in 1995, Farg’ona faced a problem of maintaining its product range and quality as well as master-ing up-to-date technologies in order to manu-facture globally competitive commodities. In this regard, the Cabinet of Ministers of Uzbekistan within the frames of an invest-ment programme together with European Bank for Reconstruction and Development and Export-Import Bank of Japan gave its approval for reconstructing the refinery with the purpose of providing quality of light oil products in accord with global standards and improving environmental state. The reconstruction project worth USD 200m was implemented by Japan-based Mitsui and Toyo Engineering.

With the launch of a diesel fuel hydrodes-ulphurisation unit in 1999, there was solved

an issue of a harmful emissions reduction — an elemental sulphur plant was built. Simultaneously, the refinery began produc-ing high quality diesel fuel (max. 0.5% of sulphur).

Starting with 2003, the country has been importing oil from the Kumkol deposit in southern Kazakhstan for processing at the Farg’ona refinery at the amount of 0.5m tonnes per year. Uzbekistan is forecast to raise oil imports mostly from Turkmenistan and Russia due to reducing production at its own oil fields and switching oil supplies of the Kumkol deposit to the Pavlodar Refinery in Kazakhstan.

Today, the Farg’ona refinery offers more than 60 types of oil products and consumer goods to its clients. Oil solvent ‘Nefras’, technical and illuminating kerosene, AI-80, AI-91, B-92 petrols and extraction state-run petrol belong to a group of light oil products produced at the refinery. Its fuels product line includes black oil, diesel fuel, boiler oil, furnace oil and jet fuel. Apart from these, the company manufactures four kinds of univer-sal oils, two kinds of engine oils for car and tractor diesels, three kinds of other engine oils, two kinds of turbine oils, six kinds of industrial oils ‘Ferganol’; hydraulic, trans-mission, compressor and spindle oils; trans-former oil of selective purification; two kinds of lubricating oils from sulphur petroleum for rolling mills. It should be also mentioned three kinds of bitumens (construction, road and impregnating), two kinds of sulphur cokes for delayed coking, grease lubricant ‘Fersol’, wax candles and technical sulphur.

Buxoro neftni qayta ishlash Zavodi

The first stage of Unitary Daughter Enterprise Buxoro neftni qayta ishlash zavodi (Buxoro refinery), a subsidiary of O’zneftmahsulot JSC, was commissioned in August 1997. The refinery built under a turnkey project by a consortium consisting of Technip (France) and Marubeni—JGC

Production facilities of Farg’ona refinery



(Japan) was partially financed by the govern-ment of Uzbekistan (USD 100m) and export credit agencies of France, the USA and Japan (USD 300m in total). It is equipped with machinery from UK-based Glitch (UK) and Thomasen (the Netherlands). In 2009, the refinery was upgraded and proceeded to manufacturing jet-propulsion fuel (180,000 tpy capacity).

The Buxoro refinery with a 2.5m tpy feed capacity is focused on processing gas con-densate and producing high quality petrol, diesel fuel, aircraft kerosene and black oil conforming to international standards. It is capable of producing 660,000 tpy of petrol (АI-80, АI-91 and АI-95), 1,030,000 tpy of diesel fuel (two grades) and 300,000 tpy of jet fuel (two grades as well). Apart from these, the enterprise turns out liquefied hydrocarbon gas, black oil, illuminating kerosene, hydrocarbon solvent С4-13 5/220 and technical sulphur.

The development programme of the coun-try’s oil & gas industry envisages the con-struction of the second stage of the Buxoro refinery up to 2016 inclusive. The cost of the project, which is to turn out 960,000 of petrol, 706,000 tpy of diesel fuel and 250,000 tpy of Euro-3 aviation kerosene, totals USD 475m.

Within its frames, a 300,000 tpy isomerisa-tion unit for the first stage of the refinery is planned for construction. The project serves to optimise and modernise existing capacity with the use of technologies for increasing light oil products yield up to 95%. US-based UOP and Honeywell Basic were awarded a contract on carrying out an audit, to be fol-lowed by doing a preliminary feasibility study. O’zneftgaz will make its own invest-ment in the project and also attract foreign credits.

JV Jarqo’rg’on neftni qayta ishlash

Russian-Uzbek joint venture Jarqo’rg’on neftni qayta ishlash set up a USD 7m new

refinery for processing “heavy oil” in Jarqo’rg’on (Surkhandaryo province) in 2005.

The 55:45 joint venture is owned by Petromaruz LLC (St. Petersburg) and Jarqo’rg’on neft JSC. The refinery has capacity to process 130,000 tpy of heavy crude oil, of which 60,000 tpy of bitumen and 50,000 tpy of diesel fuel and related products are produced. In Q1, 2014 the Russian joint proprietor is planning to start up a project for heavy crude refining expansion. Till the end of the year, the JV will carry out a tender for procuring equip-ment for processing heavy crude at a license production site of the joint venture at a starting

cost of USD 39m as well as solve an issue of financing the project. This project worth USD 42.3m envisages doubling production of petrol, diesel and furnace oil and oil bitumen by 2016 at the cost of increasing a raw materials base and expanding refining capacity.

JV Igilik-gaz

Uzbek-Russian joint venture Igilik-gaz LLC was founded by Farg’ona neftni qayta ishlash zavodi Unitary Daughter Enterprise with a 49% share and by Oil & gas company StroyTransgaz-oil Progress owning 51%. The authorised capital of the JV is USD 547,000.

Outdoor installations at Buxoro refinery

Production facilities of Igilik-gaz



A mini-plant for processing gas conden-sate and hydrocarbons raw stock of Igilik-gaz located in Qo’ng’irot (Republic of Qoraqalpoq’iston) employs 72 people. The mini-plant for gas condensate processing 266А-PU utilising straight-run fractions produces petrol, kerosene, diesel fuel, sol-vent ‘Nefras’. The first stage of the mini-plant with a daily feed capacity of 120-150 tonnes came on stream in 2004. In 2005, feed capacity was increased up to 500 tonnes of gas condensate. Later, a similar 300 tonnes / day mini-plant for gas condensate processing became operational.

Plastics processing

Sovplastital

Soviet-Italian joint venture Sovplastital JSC was established on the basis of Scientific and Production Enterprise Uzbytplastik and Italy-based Alma Rosa in 1987. In 2007 the enterprise was transformed into an open joint stock company with an authorised capital of UZS 683.2m (EUR 227).

The company is focused on producing plastic goods for both consumer and indus-trial purposes including decorative elements of interior and furniture: artificial flowers, plastic furniture, accessories for bathrooms and toilets and toys. Sovplastital incorporates several daughter companies, among which we should mention only plastic processors: 1) Uzbek-Italian JV Sovplastital & Tabor spe-cialising in manufacturing artificial spruces, various souvenirs and New Year’s decora-tions; 2) Uzbek-Italian JV Sovplastital & Fiori (artificial flowers, trees and flower arrange-ments); 3) Almeko LLC (plastic goods and sheets from polystyrene, ABC-plastic, acryl polymers as well as various co-polymers and vacuum moulding goods); 4) Tashinvestplast LLC (large-sized rotational moulding goods including those for industrial purposes). The product range of Sovplastital has more than 8,000 items. The company possesses more than 800 protection documents of various

categories including trademark certificates, patents of the Republic of Uzbekistan and the Russian Federation on different manufactur-ing processes and product designs.

Its net earnings, and net income have reduced significantly over recent years although assets have increased in value (in particular, they amounted to UZS 14.85bn (EUR 5m) in 2011).

Uz-Koram Ko

Uz-Koram Ko LLC was founded by Koram Plastics Co., Ltd (South Korea) and two Uzbek companies — O’zavtosanoat JSC and Sabr Ko in 1995. Authorised capital is USD 5m. In 1997, the company started producing large-sized plastic goods (automotive bumpers and tool-bars for cars produced at GM-Uzbekistan JSC). Six injection moulding machines by Japan and Korea are installed in the company’s work-shops capable of producing 270,000 automo-tive items. Uz-Koram operates a paint spraying line by Yaskawa Motoman for coating bumpers in colours matching with those of car bodies. It should be mentioned that Uz-Koram Ko is the only company in Uzbekistan engaged in hot shaping of polypropylene (the correspondent workshop was commissioned in 2009).

Uzbarrelproduction

Toshkent-based Uzbarrelproduction LLC registered as an Uzbek-English joint venture manufactured the first products in May 2005. The main activity of the company is pro-duction of 10, 20, 30, 60, 155 and 220 litre polyethylene drums for food and industrial products. Manufacturing capacity amounts to 400-430 drums per day (90 tonnes monthly). These receptacles intended for storing and transporting liquid and loose materials con-form with European production and trans-portation standards having high safety factor and low weight. At first, these drums, which have no analogues in Central Asia, were in great demand in Azerbajan, Kazakhstan, Kyrgyzstan and even competed with similar

Russian products on price. However, the financial state of the company employing 50 steadily worsened. Finally, a court decision was made to launch bankruptcy proceedings against the JV in July, 2013.

Andijon Polietileni and Andijon Polipropileni JV

Located in Andijon, Uzbek-American Andijon Polietileni JV turns out PE film for cotton cultivation. PE bags by Andijon Polietileni are in high demand both in the local and foreign markets.

JV Retal Pet

Uzbek-Russian joint venture Retal Pet was created by NB-Retal CJSC. The latter is one of the leaders in producing press moulds for PET processing in the CIS and Russia being a subsidiary of international company Retal Industries – one of top-three European pro-ducers of press moulds. Retal Pet began its own production of press moulds in Toshkent in 2006. Since late 2007, it has been the big-gest player on the Uzbek market in press mould for PET processing.

Other enterprises of the sector

Among domestic enterprises – plastic pro-cessors – we should also single out Nukus Polipropilen LLC (Nukus) producing PE bags (including inflatable bags), PP packages and bags and Uzbek-Turkish joint venture Nur-Plastik LLC (Andijon) manufacturing PE films of different kinds and for various purposes (sleeved films, greenhouse films, co-extrusion three- and five-layer films).

Production of inorganic chemicals

Navoiy kon-metallurgiya kombinati

The construction of Navoiy kon-met-allurgiya kombinati (Navoiy Mining and



Metallurgical Combine, NMMC) started in the late 50s of the past century. This diversi-fied enterprise manufactures various indus-trial products. The facilities of NMMC are located in most part of flatlands of Uzbekistan in the interfluves of the Rivers Amu Darya and Syr Darya (Kyzyl Kum desert) in the cities of Navoiy, Zarafshon, Uchkuduk, Zafarabad, Krasnogorsk and Hurabad. It employs more than 67,000 people. Key gold and uranium deposits are concentrated in the Central Kyzyl Kum district. Having an extremely broad product range, the company gives priority to mining gold and uranium. All activities of the enterprise as a mining and metallurgical company with a full cycle of production from exploration, ore mining and processing up to producing gold (999,9) and diuranium pentoxide-uranium trioxide are based upon these valuable minerals. NMMC accounts for 80% of total gold output in the country and is the sole operator in Uzbekistan engaged in the mining and export-oriented manufacture of uranium in the form of a ready-to-use product – diuranium pentoxide-uranium trioxide.

The foundation of its raw materials source is twenty deposits and ten promising fields of uranium. The uranium industry is rapidly developing owing to rising production at the operating enterprises and putting into opera-tion new manufacturing facilities.

NMMC has been mining all its uranium by underground leaching over the past fifteen years. This technology has enabled the company to radically change and sig-nificantly increase its raw materials base via economically viable mining operations at arenated-type deposits with low-grade uranium ores in the Kyzyl Kum region. To raise uranium production became expedi-ent due to high prices in the global market. Since achieving independence, techni-cal upgrading of the uranium enterprises have begun and two underground leaching mines have been built and commissioned at the Kendyktube and Lyavlyakan depos-its. Moreover, pilot development of the

Sugraly and Tokhumbet uranium deposits by underground leaching have started. Recently, the Severny Kanimekh, Alendy and Meylisay deposits have become operational. Presently, six uranium mines utilising in-situ leaching are operating, and another nine uranium deposits are being developed. Uranium-containing ore pro-duced at the mines undergoes final process-ing at GMZ-1 (Hydrometallurgical plant), after which it is marketed as a finished product (diuranium pentoxide-uranium trioxide).

Apart from the above-mentioned, NMMC mines phosphate rock, produces sulphuric acid and gold and silver articles. In addition, the company has mastered manufacture of liquid glass, explosives, PVC and PE pipes.

And now we will make a retrospective jour-ney into the history of the enterprise. Navoiy mining and metallurgical combine dates back its history to 1 September 1958, when the gold ore deposit Muruntau was brought into operation. In 1962, pilot workshop #1 was launched by the company, at which a technology for extracting uranium from the

ores of the Uchkuduk deposit was tested. In 1963, the Severnoye mining administration adopted the underground leaching technol-ogy. The Hydrometallurgical plant (GMZ-1) came on stream in 1964 to start commercial production of diuranium pentoxide-uranium trioxide. In 1966, pilot workshop #1 began developing a manufacturing process for extracting gold from the Muruntau deposit followed by the start-up of open-pit mining at the said deposit in 1967. The construction of GMZ-2 began the same year. The year 1969 was marked by developing the Yuzhny Bukinay uranium deposit, which gave its first commercial batch of uranium ore three years later.

Also, in 1969, GMZ-1 switched to pro-ducing finished products in the form of diuranium pentoxide-uranium trioxide, while GMZ-2 made its first gold ingot. In 1971, Mining administration #5 was established (Leninabad mining and chemi-cal combine). A year later the Yuzhnoye mining administration started pilot produc-tion of uranium by underground leaching, while GMZ-2 mastered the manufacture of

Mining facilities of Navoiy Mining and Metallurgical Combine



affined silver. The second stage of GMZ-2 went into service in 1973 and the third one – in 1975. The first batch of uranium from the Beshkak deposit was mined in 1978. The advancement of the under-ground leaching technologies in the 80s predetermined the construction of H2SO4 manufacture as part of NMMC. A sulphuric acid plant in Uchkuduk entered into service in 1985. The plant reached its nameplate capacity (450,000 tpy) within only three months. Along with increasing industrial demand for sulphuric acid, the company built the second stage of the Uchkuduk plant with a capacity of 210,000 tpy in January 1989. However, when political and economic reforms in the post-Soviet states began, the second stage was closed down. In 1986, a technology for extracting associated rhenium was developed at the enterprise and ammonium perrhenate pro-duction became operational. In 1995 there were brought into service the first stage of GMZ-3 and a gold heap leaching complex (presently CGHL of the Central mining administration). In 1996, mining opera-tions began at the block Tashkura of the Dzheroy-Sardaryo phosphorites field, and the Yuzhnoye mining administration con-structed and launched a PVC pipe plant.

In 1997, a uranium mine using under-ground leaching was put into operation at the Kendyk-Tube deposit, and GMZ-1 mastered commercial production of liquid glass.

In 1998, the Kyzyl Kum phosphorite complex utilising newest technologies devel-oped by NMMC together with specialised organisations from Russia and Uzbekistan was brought into service. To be precise, the first stage of the complex with a capacity 300,000 tpy of ground phosphate rock came on stream. The Yuzhnoye mining administra-tion started up a polyethylene pipe workshop in 2000.

In addition to raw ground phosphate rock, the Kyzyl Kum phosphorite complex began manufacturing calcined phosphorite concen-trate supplying it to Samarqand and Olmaliq,

where phosphorus fertiliser production started up. By the end of 2001, the calcined phosphorite concentrate unit operated at its full capacity of 430,000 tonnes per year.

In 2002, the Central mining administration launched an emulsion explosives plant. The main ingredient of explosives is pelletised ammonium nitrate produced by Navoiyazot JSC. The proximity of a reliable supplier guarantees virtually unrestricted shipments of raw materials. Thus, the country no longer imports expensive foreign explosives. Blasting operations at affiliates of NMMC have entirely switched to up-to-date innova-tive technologies, whereas dangerous, not efficient labour has been eliminated and the efficiency of ore mining operations has sig-nificantly improved. With growing output of packaged emulsion explosives (nobelit and nobelan), the enterprise provides with explo-sives not only its subsidiaries but also leading companies engaged in blasting operations across the whole country. Today, 80-85% of raw materials used by the emulsion explo-sives plant are of local origin, which saves the country about USD 8-10m yearly.

In 2003, Mining administration #5 com-menced the development of the Tokhumbet deposit. In 2005, workshop #1 started work-ing at adopting a technology for biological leaching of ores from the Kockpatas and Daugyztau deposits. In 2005, the Severnoye mining administration began to construct a complex for biological leaching of gold on the basis GMZ-3, and Uzbek-Russian joint venture for processing anthropogenic wastes of mining and metallurgical production was set up. To further facilitate the commercial development of the Dzheroy-Sardaryo phos-phorites field, improve quality and phos-phorite products output, in 2006, there was introduced an integrated engineering process for beneficiating phosphorite ores. The inte-grated manufacturing process allows for producing 400,000 tonnes of washed and cal-cined phosphorite concentrate and 200,000 tonnes of the washed and dried concentrate.

In 2007, the Kyzyl phosphorite complex

put into operation a unit for separating phos-phorite ore from chlorine.

In 2008, after upgrading, GMZ-2 reached its designed feed capacity of 32m tpy of gold-containing ores. Since its start-up, GMZ-2 had processed 700m tonnes of gold-contain-ing ores by that time. In 2008, the Severnoye mining administration introduced a technol-ogy for bacterial leaching BIOХ® as well.

In 2009, the company proceeded to the development of the Maylisay deposit of rare earth metals.

A high angle conveyor became operational at the Muruntau mine.

Besides these, NMMC built a pilot ore-picking complex for beneficiating gold-con-taining ore with a 1.2m tpy feed capacity over the period passed since the country gained independence.

At present structural divisions of NMMC that are engaged in chemical production are as follows: 1) Mining administration “GMZ-1” - manufacture of diuranium pentoxide-uranium trioxide, rhenium and gold (Navoiy); 2) Central mining administra-tion (Zarafshon): hydrometallurgical plant #2 (GMZ-2) for processing gold-containing ores; a mine and a workshop for heap leach-ing of gold ores; the Kyzyl Kum phosphorite complex; the packaged emulsion explosives plant; 3) Severnoye mining administra-tion (Uchkuduk): a uranium underground leaching mine; gold-containing ores mines; hydrometallurgical plant #3 (GMZ-3); a sulphuric acid plant; 4) the Yuzhnoye mining administration (Nurobod): hydrometallurgi-cal plant #4 (GMZ-4); underground gold ores leaching mines; gold ores mines; a PVC and PE pipes plant; 5) Mining administration #5 (Zafarabad): uranium underground leaching mines.

Modernisation and capacity expansion of chemical production are key areas of concern for the company over many years. The year 2014 will not be an exception. In the short run, NMMC will commence construction of a new sulphuric acid unit. Initially, the com-pany planned to begin it in 2012, but the pro-



ject was declared economically inadvisable at that moment and postponed. The project preliminary estimated at USD 125m envis-ages the building of the 500,000 tpy sulphuric acid unit, which will satisfy increasing needs of uranium production due to commissioning new mines and expansion of a raw materials base. Construction period will last two years. Navoiy kon-metallurgiya Kombinati will provide its own finance for the project.

In addition, NMMC is planning to raise output of quality phosphorite raw materials up to 716,000 tpy. Within the frames of another investment project entitled ‘Expansion of current phosphorites beneficiation produc-tion’ on the basis of the operating Kyzyl Kum phosphorite complex, there was signed a EUR 19,96m contract on basic and detailed engineering, equipment, material and spare part procurement, installation supervision and start-up activities between Navoiy kon-metallurgiya Kombinati and Germany-based Engineering Dobersek GmbH in 2012. The USD 59.9m project will be backed by NMMC’s own funds (USD 24,92m) and a USD 35m credit of the State-Commercial National of the Republic of Uzbekistan.

O’zbekiston Respublikasi qattiq qotishmalar va o’tga chidamli metallar kombinati

O’zbekiston Respublikasi qattiq qotish-malar va o’tga chidamli metallar Kombinati JSC (Uzbek integrated works of refractory and heat-resistant metals; Chirchiq, Toshkent province) is a diversified company having

50-year experience of producing tungsten and molybdenum products. The integrated works with a closed process cycle consists of hydrometallurgical, powder, wire, and rolling and melting units. The availability of its own resources of W- and Mo-containing raw materials in Uzbekistan (Koytash and Ingichkin mines) together with the rapid, pro-gressive advance of the chemical sector and fuel and energy complex and the develop-ment of Elektrkimyosanoat JSC in Chirchiq producing high purity hydrogen, nitric acid and ammonia water required for W and Mo manufacturing processes predetermined localization of production of these metals in the said region. According to a project made by the Federal State Research and Design Institute of Rare Metal Industry (‘Giredmet’; Moscow), the integrated works was designed as an enterprise with a continuous process, up-to-date equipment and large production capacity.

The integrated works traces its history to 1956, when the first molybdenum bar was obtained laying the foundation of the company’s development. In 1957, there was approved a planned task for design and con-struction of a wire workshop and a unit for rolling products for vacuum tube production. In spring 1958, the company started manu-facturing new types of products necessary for the metalworking and mining industries – hard-alloy components.

In 1962, workshop #1 mastered produc-tion of Mo square bars for further processing. They were used for turning out round bars and flat-rolled products. Starting with 1965

the workshop began manufacturing molyb-denum rods of MC grade, of which one was able to produce wires with increased recrys-tallisation temperatures.

In 1963, the company was the first in the former Soviet Union to set up pilot produc-tion of single crystals from molybdenum and tungsten and products thereof including bars, wires, flat-rolled products and strips. At dif-ferent times, the company started producing new kinds of products.

In particular, in 1965, manufacture of Mo ingots of MchVP grade began;

in 1966 – wire made of Mo ingots of MchVP grade;

in 1967 – wire made of alloy of BP-273VP grade;

in 1968 – single crystals with preset crys-tallographic orientation of OChM – OM grade (ø10-20mm) as well as wire for com-ponents of vacuum-tube devices and wire with increased recrystallisation temperature from Mo single crystals;

in 1969 – bars from yttrium tungsten of SVI-1 grade, Mo single crystals with preset crystallographic orientation of OChV – PD grade and bars thereof.

In 1967, a tungsten anhydride unit came on stream because of rising production of tungsten wire. The integrated works utilised tungsten raw materials from third-party sup-pliers for six years after its launch and Mo feedstocks from outside producers - over seven years. In April 1962, hydrometallurgi-cal workshop #4 went into service. This ena-bled the company to largely satisfy demand of its metallurgical workshops for raw mate-

Products of Uzbek integrated works of refractory and heat-resistant metals



rials. The workshop used a classic technol-ogy of autoclave and soda decomposition of artificial scheelites at the beginning of the process and acid decomposition of artificial scheelites up to wolframic acid followed by re-washing the said acid by ammonia water and evaporating paratungstate. Subsequent introduction of a continuous process of artificial scheelite decomposition and wash-ing of wolframic acid in column equipment significantly enhanced the production capac-ity of the workshop and simplified work of maintenance personnel. Unlike acid treat-ment with the help of hydrochloric acid used at similar plants at that time, the integrated works adopted a technology for processing artificial scheelites by nitric acid decomposi-tion. In the course of the nitric acid method of Mo concentrates processing, molybdenum and accompanying rhenium entirely go into solution. The company introduced a sorp-tion technology for extracting molybdenum and rhenium from solutions, which had been a difficult task due to their complex salt composition.

As a result, the company had the possibil-ity to use equipment and pipelines made of acid-resistant stainless steel, improve equip-ment reliability and process wastewaters into sodium nitrate. The latter was both used for intraplant consumption and commercial sales. The company together with scientists synthesised a sorbent for sorption of tungsten from concentrated solutions, developed a technology for its extraction and tested sorp-tion processes at a pilot plant. In 1976, there was put into operation an industrial-scale unit for sorption extraction of tungsten, which replaced four basic process steps – sources of harmful emissions. The introduction of the sorption technology enabled the inte-grated works not only to improve production efficiency but also to cut primary and aux-iliary raw materials consumption as well as to reduce manufacturing costs and manual labour. In the early 70s, the company devel-oped and introduced automatic production processes for continuous purification of tung-

sten solutions from molybdenum, silicium, fluoride, arsenic and permanent sedimenta-tion of artificial scheelite.

A technology for ammonium paramolyb-date was improved as well. In 1978, a melt-ing and rolling workshop cane on stream. That large and complex production facility for refractory metal goods had no analogue in the former Soviet Union. Flat-rolled prod-ucts and round bars from refractory metals were turned out there. Production processes were carried out both in vacuum and inert gas media with the use of complex equipment and process control systems.

By mid 80s, the integrated works mastered production of 117 products supplied to more than 5,000 consumers including foreign ones. By mid 90s, the company could turn out 130 kinds of marketable products for industrial purposes and more than 45 kinds of con-sumer goods.

In 1994, production of lamps utilising imported components was set up at the enterprise. Loss of economic ties with the former Soviet Republics oriented towards the defense industry, special metallurgy, radio electronics and illuminating engineering was a shattering blow to the company and resulted in initiating a bankruptcy procedure.

From 1996 to 2003, the company remained in the red due to a shortage of its own float-ing assets, which did not allow the integrated works to complete installation of imported equipment for producing molybdenum rolled stock (a rolling mill and a cutting machine). At the same time, the capacity of a tungsten wire drag line brought on stream in December 1998 already exceeded demand for this prod-uct in the global market.

Today, re-starting spare capacity, attracting investments in projects for reconstructing the beneficiation plants and maintaining unique tungsten and molybdenum manufacture is of urgency proceeding from rising global demand for tungsten and molybdenum prod-ucts for steelmaking.

In early 2006, the Government of Uzbekistan approved a programme for devel-

oping the country’s tungsten deposits with a total tungsten concentrate output of 2,700 tpy for the 2007-2013 period with the purpose of increasing the capacity utilisation of the integrated works. However, the programme has not been launched yet for a number of financial and technical reasons. Now raw materials for manufacturing Mo-containing products are supplied from Olmaliq min-ing and metallurgical combine (Olmaliq, Toshkent province), while a tungsten feed-stock is delivered from Russia on the basis of tolling agreements. Currently, the operating rate of the company average 20%. Moreover, there is a distinct tendency towards a further decline. For instance, the Uzbek production of metallic tungsten showed a 25% YOY reduction, to 98 tonnes in 2013. The output of metallic molybdenum at the integrated works fell 6.5%, to 490 tonnes. The decline can be related to shrinking global demand for these products. All the company’s production facilities are located at two sites. The first site is a stage of obtaining metallic molybdenum and metallic tungsten and their processing into rolled stock, wire and hard alloys.

The second manufacturing site is a hydro-metallurgical stage combining workshops #4, #5 and #6 for converting concentrates into intermediate products – ammonium molybdate, ammonium perrhenate, tungsten trioxide, ammonium paratungstate, etc.

The integrated works has a full process cycle from processing concentrate up to manufacturing of commercial products from tungsten and molybdenum, hard alloys and tools thereof as well as incandescent lamps for general purposes.

Mo production includes the following stages: 1) hydrometallurgical processing of molybdenum concentrates, industrial prod-ucts and Mo-containing wastes by nitric acid decomposition with producing ammonium molybdate; 2) production of metallic powders and Mo workpiece blanks by powder metal-lurgy via reduction of molybdenum trioxide in the hydrogen environment (ammonium molybdate serves as a feedstock for MoO3);



3) manufacture of molybdenum rolled prod-ucts and alloys with obtaining Mo rods and wire with a diameter of from 0.03mm to 20mm by treating Mo rods via thermoplastic deformation in the hydrogen environment at forging and drawing equipment; 4) melting and rolling production of vacuum-melted ingots and small and large-size, flat-rolled products from molybdenum; 5) production of hydrogen and oxygen in electrolytic baths via electrolytic decomposition under pressure for production workshops; 6) manufacture of general-purpose lamps with the use of tung-sten, molybdenum wire and component parts.

Tungsten manufacture includes the follow-ing stages: 1) hydrometallurgical processing of tungsten concentrates and tungsten-containing wastes with producing tungsten anhydride (up to 3,900 tonnes / year); 2) production of metallic powders and compact tungsten workpiece blanks via powder met-allurgy (1750 tonnes/year), where tungsten anhydride serves as a feedstock; 3) produc-tion of hard alloys (1000 tonnes / year); 4) production of tungsten wire (1,75m metres / year), tungsten rolled products (228 tonnes / year) with tungsten rods as a feedstock.

The enterprise has a full process cycle for hard alloys and compounds obtained via preparation of tungsten carbide and titanium carbide followed by mixing with cobalt. Hard-alloy compounds after high-temper-ature pressing and agglomerating convert into hard alloys of two groups WC-Co and WC-TiC –Co possessing high hardness, strength and wear resistance. Hard alloys of various types are used for fabricating lathe and woodworking tools and milling as well as drawing and mining equipment. Besides these, non-standard high-wear details for machinery and mechanisms are made of hard alloys from various grades.

The product range of the company includes molybdenum and tungsten powders, rods, bars, Mo strips, wire, bars from molyb-denum single crystals, Ti-W and Ti-Ta-W compounds, Ti-W and Ti-Ta-W compounds, ferromolybdenum and ferrotungsten, W-Cu

alloy ingots, Y-W rods, powdered tungsten carbide and aluminium sulphate for water treatment (coagulant).

Olmalik Kon-Metallurgiya Kombinati

Olmalik Kon-Metallurgiya Kombinati JSC (OKK, Olmalik Mining and Metallurgical Combine, Toshkent province) engaged in mining and processing ores of noble and nonferrous metals is an industrial complex consisting of three open pit mines, four underground gold mines, five ore dressing plants, two metallurgical works, sulphuric acid units, an explosives plant and a lime-stone plant.

The governmental decision to construct a lead-zinc mine Altyn-Topkan became fun-damental for the Olmalik mining and metal-lurgical combine and the date of signing that document became a birthday of the OKK. The first products rolled off its production lines in 1954. Altyn-Topkan lead and zinc combine

was renamed Olmalik Kon-Metallurgiya Kombinati in 1967. This name corresponded with both the profile and the geographical location of the enterprise, which was justly called a flagship of the ferrous metallurgy of the republic by that time. In 1997, Pb-Zn mining activities stopped and the combine switched over to processing Cu-Mo ores mined at a quarry put into operation at the Sary-Chequ deposit in 1974.

But the core of copper production was the Qalmaqyr deposit. A copper beneficia-tion plant and a copper smelting works were established on its basis. In 1959, an act of acceptance of the first stage of the Qalmaqyr deposit was signed. At present, two Cu-Mo ore mines are merged into a single company — the Qalmaqyr Mining Administration.

The copper beneficiation plant is the larg-est one of its kind in Uzbekistan producing Cu and Mo concentrates, of which noble and precious metals are recovered including gold, silver, rhenium and cadmium in addition to ferrous metals.

A copper-smelting furnace at Olmalik Mining and Metallurgical Combine



The first stage of copper beneficiation plant came on stream and the first batch of Cu concentrate was manufactured in 1961, which is celebrated as its birthday.

As a basic feedstock, the company utilises reserves of a group of Cu-Mo, Pb-Zn and Au-Ag ore deposits located in the Toshkent, Jizzax and Namangan provinces.

The deposits of the district are notable for high complexity. Currently, a list of minerals includes 179 different names, of which 60 belong to ore minerals. All the deposits are characterised by interbedded layers of molyb-denite, pyrrhotine, pyrite, bornite, sphalerite, chalcopyrite, galenite and hematite. These in fact contain noble metals as well as rare and trace elements.

The porphyry copper and gold- and molybdenum-containing deposits Qalmaqyr and Sary-Chequ supply raw materials to a copper division of the copper beneficiation plant (CBP) for further processing. The ores from Sary-Chequ are beneficiated at the ben-eficiation plant CBP-2 and the concentrates are processed at the copper smelting plant.

To provide the zinc plant with a feedstock, the combine process zinc concentrates into metallic zinc and cadmium, refined lead and sulphuric acid on the basis of tolling agree-ments. The Qauldy mine, the Angren mining administration, the Chadaq mining admin-istration, and the Angren and the Chadaq gold recovery factories belong to the gold extraction division of the combine, and their products are supplied to the copper smelter for processing.

Copper reserves of the Qalmaqyr deposit amount to 20m tonnes. This fact allows including the raw materials base of the Olmalik mining and metallurgical combine

in one the largest of its kind worldwide. Limestone for production processes are sup-plied from the Saukbulak lime deposit.

The combine’s raw materials base is nota-ble not only for mineral reserves but also for some other useful resources including mine dumps, mill tailings, and metallurgical pro-duction wastes. Raw material reserves accu-mulated at these man-made objects amount to millions of tonnes and can serve an additional source for manufacturing various metals and other products.

More than 30m cubic metres of rock mass are yearly processed at the combine, and twelve various chemical are extracted.

The company produces refined copper (in cathodes of min. 50 kg; Cu — min. 99,99%, 1000x1100х(10-15) mm), metallic cadmium of КD-0 grade (Cd — min. 99,974%, ingots — 380х190х22 mm, weight — about 10 kg), powdered technical selenium of SТ-1 grade (Se — min. 99,3%, Fe — min. 0,005%, Cu — min. 0,005%), technical tellurium of T-1 (Te — min. 99,66%) and T-2 (Te — min. 99,34%) grades as well as copper sulphate (see Table 4), ammonium perrhenate of АР-1 (Re — min. 69,23%) and АР-2 (Re — min. 69,245%) grades.

A technology for metallic zinc production encompasses stages of concentrate roasting, ore leaching, and electrolysis. The produc-tion capacity of the combine enables it to manufacture 125,000 tonnes of zinc per year (Zn — min. 99,988%) in 25kg ingot bars. All these products are sold in the domestic market via the Uzbek Commodity Exchange. Zinc is exported to Iran, Russia and Ukraine.

Up to 80% of sulphuric acid produced by Olmalik Kon-Metallurgiya Kombinati is shipped to subsidiaries of O’zkimyosanoat

for making mineral fertilisers. Companies from Tajikistan, Kyrgyzstan and Kazakhstan are also among the consumers of the combine.

Copper, fine gold and silver occupy a significant share in sales. Like other manu-facturing enterprises of the country, Olmalik Kon-Metallurgiya Kombinati has developed and is currently successfully implementing a programme for technical and technologi-cal modernisation. Till the end of 2015, it is planned to upgrade the zinc plant, build a sulphuric acid workshop and install a new furnace at the copper smelter, set up produc-tion of portland and white cements in the Jizzax province and reconstruct grinding and fine grinding units at the copper beneficiation plant.

Angren Kaolin LLC

Uzbekistan is extremely rich in primary and secondary kaolinitic clays. Proven reserves of kaolin are located at the Angren deposit (Toshkent province) — the largest complex deposit of brown coal, fire clay and kaolin in Uzbekistan. The reserves of secondary, raw kaolin at the Angren deposit total 382.4m tonnes. Primary and secondary kaolinitic clays are used as a feedstock for cement and ceramic goods production. In 1998, Germany-based PAB Bautzen put into operation a 200,000 tpy kaolin beneficiation plant on the basis of the deposit. The project was financed by a DM 57m loan of Berliner Bank under the guarantee of the Uzbek gov-ernment and refinanced by the National bank for foreign economic activity of the republic of Uzbekistan. The loan was to be repaid within 9.5 years including 2 years of a credit grace period at a 6.8% annual interest rate. An Uzbek-German JV ‘Kaolin’ (Angren, Toshkent province) took full ownership of the plant. The co-founders of the JV were company KulKoni (51%) and Ugol JSC (49%) (now - O’zbekko’mir).

In autumn of 1999, KulKoni transferred its proprietary rights to PAB Bautzen. The plant was not capable of entering target sales

Table 4. Properties of copper sulphate produced by Olmalik Kon-Metallurgiya Kombinati JSC

Brand Grade% of total

СuSO4 output

СuSO4x 5H2O, %

Cu, % Fe, %H2SO4,

%

Insoluble residue,

%

ATop grade 40,60 % 99,50 25,32 0,017 0,025 0,03

1 48,20 % 98,76 25,14 0,017 0,025 0,032

B 1 11,20 % 97,50 24,83 0,020 0,025 0,033



markets in Europe. The JV only made annual supplies of 10-12,000 tonnes to the countries of Central Asia and the Middle East.

In March 2007, the Economic court of the Toshkent province declared ‘Kaolin’ a bankrupt. At the moment of bankruptcy, the share of PAB Bautzen in the JV made up 44% and that of O’zbekko’mir JSC — 56%. The enterprise went into receivership. The deci-sion of the court was made because the JV had not performed its liabilities for repaying foreign loans attracted under the governmen-tal guarantee.

In spring 2009 the government of the coun-try put up for sales 184 bankrupt companies including the JV Kaolin. Angren Kaolin LLC was established at the production site of the joint stock company currently owned by the National bank for foreign economic activity of the republic of Uzbekistan (basic creditor of the JV). By mid 2009 the com-pany restored manufacturing facilities and resumed production of the deficit feedstock.

Currently, Angren Kaolin LLC produces high quality raw materials for the pulp and paper, sanitary engineering, delftware and porcelain production and the ceramic industry.

Qo’ngirot natriy sulfat

Qo’ngirot natriy sulfat Unitary Enterprise is the youngest chemical enterprise in the country set up in November 2013, when there began production of high quality export-oriented sodium sulphate and top grade iodised table salt in Qo‘ng‘irot district of the Qoraqalpog’iston Republic.

The company is expected to manufacture 148 tonnes of sodium sulphate and 148 tonnes of iodised salt daily already in the near-est future. In Uzbekistan, domestic sodium sulphate demand amounts to 50,000 tpy. At present, the chemical product is exported at USD 500 per tonne on average. Production costs of a tonne of Uzbek sodium sulphate equal UZS 250-300,000, which is one fifth of those of the foreign analogues.

Qo’ngirot natriy sulfat has bright devel-opment prospects due to availability of plentiful natural resources for producing this chemical product. To realise the pro-ject, the above-indicated reserves of mira-bilite in the north of the country will be utilised. The launch of the plant will make a valuable contribution towards developing detergents and glass manufacture as well as to the textile, leather, metallurgical and pulp industries.

Bo’ston Talk

Bo’ston Talk LLC specialises in ver-miculite ores mining and processing at the Tebinbulak deposit (Qarao’zak district of Qoraqalpog‘iston republic), where an ore mining and processing industrial complex was built. With an annual capacity of 8,000 tonnes, it is capable of producing vermiculite concentrate. Total reserves of the Tebinbulak deposit are estimated at 1,33m tonnes. Owing to its valuable sound- and heat-insulation properties and impressive lightness, vermicu-lite is useful over a wide range of applica-tions in a number of manufacturing indus-tries, the construction sector and agriculture. Application fields of vermiculite materials in chemical technology and equipment is quite broad. In particular, vermiculite-containing granulated materials are used on a large scale in cleaning and drying of gases and organic liquids, chemical purification and industrial wastewater treatment and separation of required components including oil products. Researches and pilot production confirm the possibility of their use for purifying indus-trial wastewaters from copper, nickel and cobalt cations. The main consumers of prod-ucts from exfoliated vermiculite are thermal power stations, glass and cement works, agriculture, paints and coatings manufacture and the construction sector. Bo’ston Talk exports its produce as well. For instance, it has already shipped 82 tonnes of vermiculite to its clients in Ukraine, Poland, Russia and Afghanistan.

Paints and coatings

Today, about 400 various paints and coat-ings are manufactured in Uzbekistan. The capacity of the domestic paintwork materials market in physical terms is 230,000 tonnes. This market is notable for a distinguished upward trend, with yearly growth rates of approximately 9%.

In Uzbekistan, several large enterprises with a total capacity of 120,000 tpy are engaged in this business. However, they can-not meet domestic demand, import deliveries accounting for 50-52% of market volume. Despite low production volumes, small com-panies manufacture nearly 20% of total out-put. They are basically focused on enamels and semi-finished varnishes for external and internal applications.

Basic trends in the market are fast-growing manufacture of water dispersion coatings and oil paints with low concentrations of organic solvents along with a decrease in a share of oil paints with high concentrations of organic solvents. Water dispersion paints, primers and enamels are most popular among con-sumers. These paintwork materials are used by more than 90% of repair and construction companies.

The paints and coatings market in Uzbekistan features stiff competition and rivalry between home and foreign suppli-ers. Most imported coatings belong to the luxury segment. Key exporters of paints and coatings to the country are Russia, Germany, Belarus, Finland, Korea and Lithuania.

The government of the country makes every effort to protect the domestic producer. In 2011, it imposed a special tax on imports of some types of paintwork materials. In par-ticular, foreign paints and varnishes on the basis of synthetic polymers, modified natural polymers, acrylic and vinyl polymers as well as oil paints and varnishes are taxed at USD 0.5 per kg.

Due to expansion of the Uzbek mar-ket over the past years, this industry is



regarded as investment-attractive. Foreign majors wish to set up their own production facilities in the republic. Demand for coat-ings has been lately displaying a stable, upward trend not only in construction but also in furniture production and mechani-cal engineering. At the same time, paints and coatings consumption in Uzbekistan barely reaches 5 kg per capita.

The consumption of paintwork materials rises steadily in recent years as well. Experts note that due to a significant income gap, which will remain in the country for pretty a long time, the price structure of a range of coatings should be differentiated. The fact that the majority of consumers express no preferences to domestic or foreign coatings together with increased activity of Western producers should stimulate Uzbek manufac-turers to take all measures aimed at main-taining and developing domestic coatings production.

JV Toshkent lok bo’yok zavodi

JV Toshkent lok bo’yok zavodi JSC (Toshkent paints and coatings plant) is the biggest manufacturer of paintwork materials in Central Asia.

The decision to build this plant was taken in 1945. The construction of the first facilities began in 1946, and the first products — 318 tonnes of oil paints - rolled off its lines in 1947.

In 1950, the company put into operation a 10,000 tpy workshop for varnishes on the basis of condensate resins in 1953, followed by a 10,000 tpy enamels and oil paints work-shop in 1953. Later there were reconstructed as well as newly built and commissioned a 10,000 tpy workshop for zinc white paints (in 1962), a 5,000 tpy workshop for grinding natural pigments, a 2,000 tpy silicate paints unit (1964), a 10,000 tpy unit for enamels on condensation resins and water-based paints

(1964) and a 2,000 tpy workshop for iron oxide pigments (1968).

A big reconstruction of the plant occurred in 1984, when a chemical water treatment unit was put into operation. In 2003, a unit for lithographic tin plate for labeled cans. Today, the company has at its disposal five basic units: a unit for varnishes based on condensation resins, a metal packaging workshop, a consumer goods workshop, an enamels and primers unit and a yellow iron oxide pigment and zinc white work-shop. The enterprise with a total area of 20.1 hectares and a 56% built environment degree is capable of producing 20,000 tpy of paints and coatings.

Its product range includes roof paint, road enamel, enamel PF-118 KhS (cold drying), matt enamel PF-117, enamel PF-133 (differ-ent colours), PF-266, PF-115, PF-191, water-based paints VD-АК-112, VD-АК-116, VD-АК-229, textured paint ‘Khoper’, var-nishes PF-283 and BT-51, primers AK-011, GF-0164 and GF-0163, red and yellow iron oxide pigments, PVA adhesive, solvent RS-2, drying oil ‘Oksol’. All these products are highly demanded on the internal market, all the more, their quality has significantly improved.

The company has plans to produce electric insulation, furniture and floor varnishes, auto-motive enamels and mastics for underbody.

JV Lok Kolor Sintez

Established in 1996, Uzbek-Dutch JV Lok Kolor Sintez is focused on producing paints and coatings for mechanical engineering, transport, construction and repair works as well as for producing auxiliary materials. The capacity of the joint venture totals 6,000 tpy of alkyde resin (semi-finished varnish) and 20,000 tpy of paints, decorative and protec-tion coatings with maximum resistance to atmospheric conditions for mechanical engi-neering, construction, aircraft and military industries, railway transport as well as for households.

Central office of Lok Kolor Sintez



Import-substituting products with no ana-logues in Uzbekistan account for more than 60% of overall coatings output. The company’s specialists carry out researches into new paints and coatings and develop available technolo-gies. At present, the company has more than 25 unique, proprietary developments. These enable Lok Kolor Sintez to enter the interna-tional market. In 2000 enamel Alur passed suc-cessful tests of Marubeni Corporation and was recommended for painting railway passenger cars. The State Standard of Russia issued a conformance certificate for serial production of primer and enamel Alur and a metal primer. The primer and enamel Alur also passed accelerated climatic tests at the Scientific and Production Association “Paint Coating” (NPO LKP; Moscow) under moderate and cold conditions.

Lok Kolor Sintez has developed and put into production flame resistant compound Deflam tested at a laboratory of the Fire Safety Head Administration of the Ministry of Internal Affairs of Uzbekistan. In 2003, the company turned out biocide (antisep-tic) paints and enamels Biocavat tested by the R & D Institute for Epidemiology, Microbiology and Infection Deceases and later recommended by the Ministry of Public Health for using in crowded areas. In 2004, it began manufacturing cost-effective mass consumption matt paint Tejam, impregnation Peneton, primer Biogrunt as components of a product line for facade finish, acrylic paints featuring resistance to water and chemicals of Akrilux series. A year later, Lok Kolor Sintez proceeded to manufacturing colour translucent varnishes at imported equipment. In 2009, alkyde enamel of diverse colours for various application fields (analogue of PF-115) and polyacrylic gloss paint Sharq went into mass production.

JV Uz Dongju Paint Company

Among other companies, Uzbek-Korean JV Uz Dongju Paint Company should be singled out. It produces a wide spectrum of automotive coatings for UZDaewoo cars.

The company was founded in 1995, when an agreement was signed on establishing a joint venture between Korea-based DongJu Industrial Co. Ltd and O’zavtosanoat with the purpose of constructing a plant in Andijon.

As far as 1997, the new plant started pilot production of automotive coatings, with first batches of the products being shipped to Uz-Daewoo Auto CJSC in 1998.

The year 1999 was marked by the com-mencement of manufacturing construction and industrial coatings supplied to clients in the Russian Federation and in Kyrgyzstan. The exports of these products to Afghanistan began in 2004. In 2004-06, the company was certified under ISO 9001:2000, ISO 9001:2000, OHSAS 18001:1999, and ISO 14001:2004.

Today, Uz Dongju Paint Company is the only supplier of coatings to GM-Uzbekistan, a manufacturer of passenger cars UzDaewoo and Chevrolet. Among the permanent cus-tomers of Uz Dongju Paint Company are two manufacturers of tractors - Toshkent Traktor Zavodi CJSC and Uzbek-American JV O’zkeysTraktor, SamAuto (Samarkand Automobile Factory; Samarqand), Uz-Koram LLC, a producer of large-sized auto parts, and JV Uz Saemyung.

Uz Dongju Paint Company also produces PVC-based sealants for abrasion-resistance and anticorrosion protection of car bodies and underbodies, polyester putties, enamels on the basis of polyester melamine, alkyde melamine, water-soluble alkyde and acrylic copolymer resins; polyester-based var-nishes, alkyde, acrylic melamine and acrylic urethane resins; primers based on alkyde melamine, chlorinated polyolefin, epoxy and acrylic resins.

Acrylic copolymer resin road paint АТ-540 U is intended for painting bitumene, concrete, bitumene-concrete road surfaces, etc.

Alkali cleaner Chemkleen #49 is used for cleaning by spraying and preparing metallic surfaces for a uniform and deep phosphate coating.

Phosphate material Chemfos-168 is a compound containing zinc, iron and phos-

phate specially designed for application of microcrystalline coatings. XW-954 Remover is a mix of organic solvents, thickeners, and leavening agents meant for removing old paint and varnish coatings including those on the basis of epoxy and polyurethane primers and enamels from industrial equipment and aircrafts.

JV Link Paints Trading

Uzbek-Russian JV Link Paints Trading (Toshkent) turns out paintwork materials offering a range of products for wholesale and retail clients – both decorative and spe-cial protective coatings. Product quality is tested by a certified laboratory fitted out with modern equipment and located at its produc-tion site.

East-Kolor

Toshkent-based East-Kolor LLC is engaged in the production and marketing of more than 40 product names of high quality coatings intended for individual customers and large enterprises. The company’s product range includes facade and interior water-based paints, enamels, primers, liquid glass, colour paste, PVA adhesives, decorative and textured plaster ‘Khoper’, acrylic plasters for various applications, polyethylene bucket containers, 100 l polyethylene drums and screw caps. The enterprise has at its disposal a manufacturing line for semi-finished var-nish and drying oil as well as a polyethylene receptacles unit. East-Kolor continuously raises its production output and has already established business links with a number of domestic big producers of feedstocks for coatings manufacture including JV Toshkent lok bo’yok zavodi JSC, Farg’ona neftni qayta ishlash zavodi and Maxam-Chirchiq JSC.

Alcohol industry companies

Ethanol is quite demanded product in the domestic market and its output rises all the



time. Local alcohol manufacturers are merged into the state company O’zspirtsanoat. Uzbekistan increased production of crude ethyl alcohol by 10.7%, to 6,038m decalitres as compared to 2011. In Q3-Q4 of 2013, food grade alcohol production in the country went up 7.7%, to 4,76m decalitres against the same period of 2012.

Andijon biokimyo zavodi

Andijon biokimyo zavodi JSC (Andijon biochemical plant) was founded in 1953 for producing technical ethanol on the basis of cottonseed hulls. When supplies of this feedstock were stopped in 1991, the plant switched to production of food grade alcohol from cereal grains (mainly from wheat grain) in accord with a project of the R & D institute Sibgipprobiosintez (Krasnoyarsk, Russia). The manufacture of food grade ethyl alcohol was launched at the then only production line with a capacity of 857,000 decalitres per year in 1999. The second line of the same capacity was built in 1999 but put into operation only in 2001. The production facility was equipped with EUR 2.82m state-of-the-art equipment in 2012 and started producing 30,000 litres of high quality food grade alcohol per day. In 2013 the similar second line worth EUR 2.7m became operational. Both lines operate at full capacity turning out 60,000 litres of ethanol daily.

The main product is rectified food grade alcohol of ‘Extra’, ‘Highest purity’ and ‘Lux’ grades complying with the State Standard GOST 5962-67.

The consumers of the end produce are liquor manufacturers - subsidiaries of O’zvinosanoat.

Apart from alcohol workshops, the com-pany operates a 4,380 tonnes/year carbon dioxide unit, a medicines unit producing 5% tincture of iodine – 1.5 tonnes/year, 1% alcoholic solution of brilliant green1% - 0.8 tonnes/year and 70% rubbing alcohol - 21 tonnes/year. The consumers of these medicines are daughter companies of Dori-

Darmon JSC — a pharmaceutical supplier. Till 2016, the company is expected to boost ethanol production. The holding company has already announced a tender for equip-ment procurement.

Qo’qonspirt

Established under the name Novokokandskiy khimzavod (Novoqo’qon Chemical Plant) in Qo’qon (Farg’ona pov-ince) in 1983, Qo’qonspirt initially produced sulphuric acid and ammophos. In 1989, ferti-liser manufacture closed down on account of environmental problems, and the enterprise retrofitted its equipment in order to produce ethyl alcohol from local wheat grain. The capacity of the first stage amounted to 1.6m decalitres of C2H5OH annually. The second 0.8m decalitres stage came on stream in 2000. Currently, utilisation rate exceeds 95%. Most equipment is made in Russia and relatively modern. The company changed its form of ownership and was renamed Qo’qonspirt JSC in 1999. The share of the state in the company is 51%, foreign investors own 47% and labour collective — 2%. The authorised capital of the company is more than UZS 10bn (about USD 33m). Its product range includes food grade alcohol of the following grades: ‘Extra’, ‘Highest purity’ and ‘Lux’ marketed mostly within the borders of the country (circa 80%). The rest is exported to the countries of Central Asia.

Biokimyo

The former Yangiyoʻl biochemical plant and now Biokimyo JSC started its activities in 1957, when a hydrolysis alcohol plant with a designed capacity of 170,000 decali-tres of technical alcohol was put into oper-ation. The main feedstock was plant-based raw materials — sawdust and rice hulls. At present, technical alcohol is obtained by re-distillation of ether-aldehyde fraction — a by-product of grain-based ethanol manu-facture. In 1996, there was commissioned

a complex for rectified food grade alcohol sourcing wheat grain of local origin. Today the company turns out food ethanol of ‘Extra’, ‘Highest purity’ and ‘Lux’ grades. Its capacity for ethyl alcohol (food grade) is 821,400 decalitres a year and that for rectified ethyl alcohol (technical grade) — 170,000 decalitres. Food ethanol manu-facture was certified for ISO 9001:2000 Quality Management Standards.

Biokimyo continuously works on quality improvement. In particular, under a recom-mendation of the company’s engineers, an additional column for final purification was installed at a brew-purification department, which allows for significant enhancement of organoleptic and physical and chemi-cal properties of the end product. There were also carried out serious work aimed at introducing new, more efficient enzyme preparations and a new race of distillers yeasts. The key consumers of food grade alcohol are liquor and winemaking plants of O’zvinosanoat. Besides these, food alcohol is used in medicine and food processing. Technical grade alcohol finds application in the cable industry, perfumery, scientific and production laboratories, the chemical and other industries. The state has 51% in Biokimyo, employee stock is 9% and the rest 40% is put up for sale.

Bektemir-spirt eksperimental zavodi JSC

The construction of a 300,000 decali-tres per year food ethyl alcohol plant in Toshkent started owing to a decision of the Cabinet of Ministers of Uzbekistan in 2006. A year later rectified food grade alcohol production from grain was com-missioned. The plant is capable of turning out 915,000 decalitres of alcohol per year. The main type of produce is food grade alcohol of ‘Extra’ and ‘Highest purity’ grades. Equipment and tanks used in pro-duction processes are made in Russia. The shareholding of the state amounts to 51%.



Producers of surfactants and household chemicals

Foreign-owned Enterirse ‘My lovely Asia’

The niche area of foreign-owned enterprise ‘My lovely Asia Со.’ founded in Toshkent in 2008 is household chemicals including shampoos, soap, gels for dish washing, liquid detergents, washing powders, cleaning agents as well as PVA adhesive. All in all the com-pany produces 1000 various products under the trade names Arakc, Arta, Negina, Padide, Mashhad stably demanded in the domestic market. Its customers are more than 100 dif-ferent organisations across the country.

Agro Bio Kimyo

Agro Bio Kimyo LLC (Toshkent) is a subsidiary of state-owned O’zfarmsanoat and the only domestic maker of new gen-eration disinfectants: ABK-Extra, АBK-Khloraktiv, Extra-Dez, antiseptin, means for cold chemical sterilisation DS-1 as well as skin antiseptics Antiseptin-OP. All its products are made on the basis of the most up-to-date and highly efficient environmentally friendly disinfectants by Akzo Nobel, Lonza, BASF including coconut benzine dimethylammonium chlo-ride, chlorinated izocyanurate, N,N-Bis-(3-aminopropyl)dodecylamine, glutaric aldehyde, polyvinyl pyrrolidone iodine. ABK-Extra — a professional disinfecting and washing agent for surfaces in various premises and sanitary equipment possess-ing antiviral (including HIV and hepatitis viruses), antibacterial and fungicide prop-erties. Disinfectant ABK-Khloraktiv in the form of solutions made from tablets and pellets is meant for disinfecting surfaces in various premises, furniture, sanitary equip-ment, clothing, dishware, toys, patient care items, products for medical purposes and cleaning utensils. Antiseptin is a ready-to-use transparent chemical of a light blue

colour with a characteristic odour of methyl alcohol. It possesses antimicrobial activ-ity (including tuberculosis mycobacteria), viruses, fungi and designed for treatment of small, hard-to-reach surfaces in various premises, pieces of furniture, devices and medical equipment. Disinfectant Extra-dez is a transparent liquid of from colourless to light yellow colours with a weak specific odour having antimicrobial activity against

gram-positive and gram-negative bacteria (including tuberculosis mycobacteria), viruses (hepatitis, HIV, poliomyelitis) and fungi. It has washing and deodorising prop-erties. Antimicrobial agent DS-1 is a trans-parent liquid of from colourless to light yellow colours with a weak specific odour possessing antibacterial action (including that against tuberculosis mycobacteria, germs of especially dangerous infections —

Manufacturing facilities and ready-to-use products of ‘My lovely Asia’



smallpox, cholera, legionellosis), viruses (including viruses of parenteral hepatitides and HIV), fungi and mold with sporocidal, washing and deodorising properties. It is meant for disinfecting surfaces in various premises, furniture, sanitary equipment, surgery and dental appliances, surfaces of various devices and apparatuses, cloth-ing, dishware (including laboratory one, dishwashing products, patient care items, cleaning utensils, medical wastes as well as mold. Preparation Tozaden has a wide spectrum of antimicrobial action possess-ing antiseptic, disinfectant, antifungal and antiprotozoal actions. It is meant for dis-infecting hands and antiseptical treatment of mucous membranes. Skin antiseptic Antiseptin-OP is a transparent light green liquid possessing antimicrobial action having antimicrobial activity against gram-positive and gram-negative bacteria (including against tuberculosis mycobacte-ria), parenteral hepatites, viruses of paren-teral hepatites and HIV, fungi, candidiasis germs and dermatomycosis. Preparations ABK-Insecticide and Tsimavet are trans-parent light yellow or colourless liquids containing cypermethrin and malathion as active substances. They are distinguished with sharp insecticide action against cock-roaches, flies, fleas, bed bugs, mosquitoes and their larvae as well as ticks.

Private Enterpise Ablaqulov Y.N.

Private Enterprise Y.N. founded in Chirchiq (Toshkent province) in 1998, con-centrate its activities on manufacturing prod-ucts for improving fire fighting efficiency. Over the past time, the company has devel-oped on its own together with specialists of Fire and technical laboratory of the Head Administration of Fire Safety of Uzbekistan process regulations, formulations and techni-cal conditions of manufacturing products for industrial enterprises from different indus-tries including products for ensuring fire safety.

Currently, the firm is the only in Uzbekistan to make chemical products for fire extinguishing — foaming agents produced depending upon application and storage conditions under the brands Sitora, Sitora-1, TFM-50. These are biodegradable, hydrocarbonic, fluorosynthetic, cold resistant foaming agents for general and special pur-poses intended for extinguishing class A and B fires which generate low-, medium- and high-expansion foams. As a foaming agent for concrete production (cellular concrete) and foam concrete blocks, the company proposes STAR+ - an aqueous solution of anionic surfactants with stabilising additives. Foaming agent STAR+ is used in a technol-ogy for manufacturing foam concrete with the use of excessive pressure both without preliminary production of foam (turbulent way – by mixing) and with preliminary foam generation (foam generators). Having up-to-date processing equipment, the company develops and produces washing powders, technical detergents, dishwashing detergents, products for skin defatting and treatment.

At present, the company’s specialists are working on developing surfactants that can be used as floatation reagents and wetting agents in various industries as well as liquid coolants for metal processing and produc-ing concrete and foam concrete products for treatment of mould surfaces.

Chemical machine building

O’zbekkimyomash zavodi

O’zbekkimyomash zavodi JSC was formed under the name of Uzbekkhimash in1941 on the basis of evacuated Sumy machine building plant. The plant laid the foundation of developing chemical engineer-ing in Uzbekistan. Initially, it manufactured military goods but as far as 1942 began turn-ing out civil produce. After the WW2, the plant became one of the leading enterprises of chemical machine building of the former Soviet Union. The main type of produce is

chemical equipment and turbo compressors.Before 1992 basic consumers (nearly

90%) were enterprises of the USSR. Today about 60% of the products are aimed at the domestic market and approximately 40% are exported to the CIS states.

In 1994 the enterprise was transformed into O’zbekkimyomash zavodi JSC, and became an affiliate of National Holding Company O’zbekneftgaz in 1999.

O’zbekkimyomash is a leading producer of pressure vessels and equipment for chemi-cal, oil processing, gas processing and other branches of industry. It has a staff of 470 engineers and 1080 employees of key and auxiliary facilities. The production area of O’zbekkimyomash zavodi amounts to 19.3 hectares consisting of a pressure vessel workshop, a compressors and pumps work-shop, a forgery unit, a mould workshop, and a consumer goods workshop. The company is the only producer of oil & gas equipment in Uzbekistan providing its machinery to the largest companies in the country includ-ing Sho’rtanneftgaz, Muborak Gazni Qayta İshlash Zavodi, Navoiyazot JSC, Maxam-Chirchiq JV, Olmalik kon-metallurgiya kombinati JSC and Navoiy kon-metallurgiya kombinati. O’zbekkimyomash has also supplied its produce on orders of foreign companies: ABB-Lummus Global Inс (USA), Metal Technology (Israel), Krebs-Speichim (France), Achema JSC (Lithuania), Khimprom (Volgograd, Russia), Severstal (Russia), etc.

The company specialises in designing, producing and servicing diverse equipment including that for the oil and gas industry, processing blocks, heat exchangers, col-umn equipment, evaporating apparatuses, pressure vessels, complete process units, separation equipment, filters, air coolers, centrifuging machines and pumps includ-ing turbine compressors and equipment for environmental protection. The used materials are alloy and carbonic steels and alloys, steel castings, grey cast iron and alloyed cast iron and titanium alloys.



R & D base

Institute of general and inorganic chemistry of Academy of Science of Uzbekistan

The Institute of general and inorganic chemistry of Academy of Science of Uzbekistan

was established in Toshkent in 1933. The main sphere of activities is ‘Development of scientific and practical bases of com-plex processing of mineral raw materials in Uzbekistan’. The laboratories of the institute carry out fundamental and applied researches into defining interrelations between compo-sition, and properties of new compounds. Scientific researches are targeted at develop-ing efficient technologies for deep processing of oils from new deposits of Uzbekistan, sustainable use of by-products of oil extrac-tion, creating technologies for recycling metallurgical wastes and solving urgent import-substitution problems of ferrous and non-ferrous metallurgy as well as producing innovative reagents and fire-resistant materi-als. One of the priority scientific directions of the institute is to develop bases of synthesis and technologies for obtaining mineral and organomineral fertilisers, promising defoli-ants accelerating reapening of agricultural plants, efficient polyfunctional stimulators for growth of cotton and cereals.

The institute has obtained results of a fun-damental character, which allowed it to cre-ate a new subdivision of science — adsorp-tion-energetic stoichiometry. Researches into scientific foundation of controlling properties of disperse systems, obtaining materials with tailor-made properties, regulating colloid-chemical processes, directed synthesis of polyelectrolytes and surfactants, flocculants and sorbents enable the R & D establish-ment to establish regularities of interrela-tions between colloid-chemical properties of disperse systems with their compositions and structure.

There have been developed bases of cre-ating efficient mineral and organomineral fertilisers, defoliants and stimulators.

The distinctive feature of the researches con-ducted is their link with problems and require-ments of the Uzbek economy. We should note the following developments of the institute: 1) a technology for producing optimum thinners for high melt oils and oil products; new base oils and additives for sealing greases; 2) a technol-ogy for manufacturing solvents from gas con-densate used for paints and coatings as well as a solvent for extracting plant oils and press cakes; 3) energy-saving technologies for producing innovative, efficient water-based and weakly-soluble surfactants, emulsifiers, cold bitumen emulsions, high viscosity bitumens, emulsion lubricants and adhesives from local feedstocks and industrial wastes; 4) efficient ways of mix-ing high viscosity oils as well as technologies for producing and applying multipurpose cata-lysts on the basis of nickel and molybdenum compounds for manufacturing motor fuels, lubricants and solvents directly from oil , its residues and by-products; 5) scientific bases of processing polymetallic raw materials and wastes of metallurgical production; the institute has defined ways of obtaining iron sulphate from metal-containing wastes, chrome oxide pigment from chrome-containing solutions; aluminium sulphate - on the basis of wastes of chemical etching of aluminium wastes; 6) technologies for extracting iodine from associated petroleum and geothermal waters with the assistance of sorption and desorption methods; obtaining pure crystalline iodine and potassium iodide from iodine paste as well as iodizing edible salt; 7) technologies for produc-tion of cement and exfoliated vermiculate for manufacturing heat insulation materials as well as enriching talc-magnesite ore for manufactur-ing magnesite concentrate used for obtaining high flame-resistant materials, talc concentrate for producing ceramic, rubber, abrasive and cable products; 8) organo-clay and carbon-clay sorbents have been obtained; 9) a number of surfactants and polyelectrolytes for use as sta-bilisers, flocculants adsorbents and plasticisers

of various natural and technical dispersions have been obtained on the basis of local raw materials and industrial wastes; 10) an original technology for producing superphosphate from highly carbonaceous Kyzylkum phospho-rites; 11) new kinds of complex phosphorus-, calcium-, nitrogen- and sulphur-containing fertilisers; 12) ‘Khosil’ type stimulators for plant growth have been obtained; 13) physical and chemical and technological foundations of synthesis of a number of new defoliants have been developed; 14) low toxicс, highly efficient defoliants “Sikhat” and “Mezon” and universal defoliants “Nazhot”, “Sardor” and “SuperKhMD-Zh” have been developed; 15) the institute has developed a highly efficient technology for producing a nitrogen-calcium-phosphate fertiliser from phosphorites of the Central Kyzylkum.

Science intensive technologies devel-oped by the institute are widely used by Samarqandkimyo JSC, Farg’onaazot JSC, JV Elektrokimyozavod CJSC and Buxoro neftni qayta ishlash Zavodi Unitary Daughter Enterprise.

This institute has considerable experience of successful scientific collaboration with R & D centres in Germany, France, Italy, the UK, the USA, the Russian Federation, Japan, Korea and other countries.

Future production plants and those under construction

Usturt Gaz Kimyo Majmuasi in Qaraqalpaqstan

In 2008, National holding company O’zbekneftgaz and a Korean consortium con-sisting of Kogas, Lotte Daesan Petrochemical Corporation, LG International Corporation, SK Gas and STX Energy founded a joint venture Uz-Kor Gas Chemical on the basis of match-ing contribution for implementing a project for construction of a gas chemical synthesis com-plex (Usturt Gaz Kimyo Majmuasi; Usturt).

The raw materials base of the project are gas and gas condensate deposits Surgil,



Vostochniy Berdakh-Uchsay and Severniy Bedrakh. Surgil – the largest of these depos-its with reserves estimated at 120bn cubic metres of gas – was discovered in 2009 and is currently being developed by O’zbekneftgaz.

The USD 4.1bn project will be financed by O’zbekneftgaz’s own financial resources at the amount of USD 200m and a 300m loan of the Fund of reconstruction and development of Uzbekistan in addition to credits of foreign financial institutions. The new enterprise will employ 1,000 people.

O’zbekneftgaz is currently developing the Surgil deposit on its own in order to provide Usturt Gaz Kimyo Majmuasi with 3bn m3 of natural gas per year by the moment of its launch. Another 1.5bn cubic metres will be supplied from the other above-mentioned deposits of the Usturt region. The complex in Usturt, the construction of which started in 2012, will annually process 4.5bn m3 of natural gas and turn out 4bn m3 of com-mercial gas, 400,000 tonnes of polyethylene of various density, 100,000 tpy of polypro-pylene and 100,000 tpy of pyrolysis petrol. The complex is due on stream in late 2016. Samsung Engineering, GS Engineering and Construction и Hyundai Engineering are general contractors of the project. American company KBR will provide technologies and engineering and construction services to JV Uz-Kor Gas Chemical, which will build a polyethylene unit in Usturt. The latter will be the first HDPE unit on the basis of KBR’s license utilising its own SCORE™ process.

Within the frames of the project, the American company will also undertake engineering and design of a furnace for polyethylene produc-tion and provide equipment and construction services. The HDPE unit will manufacture the following grades of the polymer: 1) injec-tion moulding grades; 2) film grades; 3) pipe grades; 4) cross-linked pipe grades; 5) yarn and monothread; 6) blow moulding grades. The PP plant will turn out homopolymers, random pol-ymers and impact-resistant copolymer. Europe, Eastern and South-Eastern Asia are expected to be the main sales markets.

A plant for processing combustible shales in Navoiy province

O’zbekneftgaz National holding Company has intentions to start constructing a plant for processing combustible shales from the Sangruntau deposit in the Navoiy province in H2, 2014.

At the end of 2013, there was issued a ten-der for a licensor of a shales processing tech-nology. Its results will be known in February-March and the construction of the plant may begin by summer of 2014. In the first half of the current year, a feasibility study of the project should be prepared and negotiations on its financing be completed.

At the first stage (2014-15), it is planned to launch a unit for processing 2m tonnes of shales per year. Later (2015-2018) unit is planned to process 8m tones of shale ores yearly and turn out 1m tpy of oil products.

The preliminary project of the con-struction of the shale processing plant was made by Russia-based Institute Atomenergopeoject federal Unitary Enterprise (St. Petersburg) in 2012. The project envisages building of eight solid heat carrier units (UТТ-3000) with a feed capacity of 1m tpy of shales. The USD 600m project will be backed by O’zbekneftgaz’s own financial resources a loan of the Fund of reconstruction and development of Uzbekistan and foreign credits.

JV Uz-Shindong Silicon in Angren

Uzbek-Korean joint venture Uz-Shindong Silicon is building a 5,000 tpy silicon plant in the special industrial zone ‘Angren’ (Angren, Toshkent province). The project estimated at USD 8.67m is implemented via direct invest-ments of the co-founders of the JV – the State geological and mineral resources committee of Uzbekistan and Korea-based Shindong Enercom Inc. The general contractor is O’zneftgaz qurulishinvest JSC. After com-

pleting the construction of the main building, warehouses, a feedstock reception area, lay-ing external and internal power supply lines, a sewage system, and water supply, foreign specialists proceeded to installation of up-to-date equipment.

Future tyre and conveyor belt production in Angren

Tyres are not produced in Uzbekistan and exclusively imported from Russia and China. That is why, O’zkimyosanoat issued an international tender for constructing a turnkey tyre and conveyor belt plant in the special industrial zone ‘Angren’ on the basis of liquidated Rezinotexnika JSC. The plant will be capable of turning out 100,000 run-ning metres of conveyor belts, 200,000 tyres for agricultural machinery and 3m tonnes of car tyres. The preliminary cost of the project is USD 230m and construction period is 3-4 years. The project will be financed through credits of the Export-Import Bank of China (USD 190m), O’zkimyosanoat’s financial assets and raised funds.

In 2011 году Chinese CITIC Ltd signed a contract with O’zkimyosanoat on turnkey basic and detailed engineering and equip-ment procurement for building the plant. Within the frames of the project, the parties are going to create a JV, in which CITIC will establish a consortium with a tyre producer. Apart from O’zkimyosanoat, Uzbekistan will be represented by O’zbekneftgaz and O’zavtosanoat JSC. In 2012, Linlong Rubber Co (China) and O’zkimyosanoat signed a memorandum of collaboration envisaging the participation of the Chinese company in the creation of the JV for the plant’s construction.

Production of base oils from wastes in Angren

Bulgaria-based Prista Oil and O’zneftmahsulot JSC are going to launch 43,000 tpy production of base oils from



wastes on the basis of hydrofining in the city of Angren as well. The USD 15m project will be realised on the production site of liquidated Rezinotexnika JSC and financed through direct investments of Prista Oil at the amount of USD 7.65m and O’zneftmahsulot’s own funds (USD 7.35m) .

The project is included in a list of invest-ment projects for expansion of production volumes of competitive products on the basis of operating plants approved by Islam Karimov - President of Uzbekistan.

It is planned to use a considerable share of produced base oils as a key feedstock for JV Uz-Prista Oil specialising in synthetic and mineral oils production in Uzbekistan. In late 2011, Prista Oil acquired 50.1% in JV Uz-Texaco from Texaco Overseas Holdings Inc (USA). The JV was subsequently renamed Uz-Prista Oil. The Uzbek founder of the joint venture is O’zneftmahsulot JSC (49.9%).

VI. Problems and prospects of Uzbek chemical industry

For almost 23 years of independence, the chemical industry of Uzbekistan has under-gone quite dramatic changes and the process of transformation is still going on. Though a basic orientation towards meeting diverse needs of the agricultural sector is still prevail-ing, hydrocarbons processing with producing various polymers is becoming priority for the country’s government. However, the modernisation and upgrade of the chemical industry, as is often the case, take place with considerable losses. For instance, produc-tion shutdown has occurred and processing equipment has been dismantled either com-pletely or partially at Uzbekrezinotexnika, Angren chemical and metallurgical plant and Farg’ona furane compounds plant. The management and personnel of the companies notable for low capacity utilisation such as Samarqandkimyo JSC, Jizzax plastmassa JSC, Olmalik Kon-Metallurg iya Kombinati JSC are faced with rather serious difficulties.

At the same time, new plants and workshops coming on stream across the virtually entire territory of the country allow Uzbekistan not only to make up for these losses but also to support the steady advancement of the chem-ical industry. There is also a serious problem that cannot be solved even by successful man-agement decisions relating to the geographi-cal location of Uzbekistan. Both the country proper and all its neighbors has no access to global sea trade and, therefore, to the cheap-est cargo delivery – by sea transport. Due to insatiable needs of agriculture, river naviga-tion is also unavailable de facto. As a result, most finished goods shipments and feedstock supply chains are based on railway trans-port. Whereas a rail network in the country has substantially improved for the years of independence and a number of its sections have been electrified, it is obvious that Uzbek chemical producers cannot increase railway tonnage capacity and improve infrastruc-ture facilities in the neighboring countries. Relatively cheap fertilisers of the domestic producers are consumed within the limits of Uzbekistan and border areas of the neigh-bors, i.e. transportation costs account for an insignificant share in price structure. On the contrary, outlooks for mid-range chemicals sales are not so bright due to long-distance haulage, e.g. to Russia or to China via transit states. In this regard, the current policy of the government aimed at developing the internal market in chemical products and encourag-ing import-substitution seems to be quite reasonable. Programmes for localisation of manufacturing finished goods, spare parts and materials on the basis of industrial co-operation adopted and promptly corrected in case of urgency by the Cabinet of Ministers every three years serve the crucial factor in this policy. The enterprises included in these programmes are exempted from: 1) cus-toms duties (except for customs formalities charges) on imported processing equipment and spare parts as well as on components utilised in engineering processes for mak-ing import-substituting products and not

manufactured in the country; 2) income tax, single tax (for entities using a simplified taxation system) on products manufactured under import-substitution projects; 3) tax on basic production assets employed for producing import-substituting products. An attentive reader has probably noted that unlike some former Soviet states, authori-ties of Uzbekistan retain efficient control under the chemical sector, and not merely administrative but also financial one. Most chemical enterprises are under the auspices of state-owned O’zkimyosanoat, and manufacturing plants that are not its affiliates but possess chemical workshops are managed by relevant state-owned stock companies. Namely, central management companies adopt development strategies of their daughter companies including issues of privatisation and financing technical upgrade projects. They also take decisions on building new large chemical works, which, as it is often the rule, is implemented in close collaboration with foreign compa-nies. The latter may be either general con-tractors (subcontractors) or investors. At the same time, tactical issues are decided by the management of the daughter com-panies on their own. It can be seen from the said above that enterprises with 100% foreign capital are rather exceptions from the rule than the rule itself. In case that a foreign partner becomes a shareholder, the state all the same holds the controlling stake. Despite the fact that investing in the Uzbek economy is rather difficult occupa-tion because of a complex and contradic-tory system of regulating foreign economic activities, the inconvertible currency, obli-gations to fulfill a number of plan figures traced through monthly statistical report-ing, obligations to sell many types of prod-ucts only via a state commodity exchange, etc., Uzbek chemical companies and their foreign partners in most cases look for-ward with optimism. Uzbekistan pursues a course of modernisation and is unlikely to turn off this way.

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