The Khauzak section, built by subsidiary LUKoil Uzbekistan, has a length of 45 km. It is designed to transport high-sulfur natural gas from Khauzak to the Dengizkul-Mubarek trunk pipeline.
The trunk gas pipeline is expected to be commissioned late this year. A production sharing agreement on the gas production project was signed in June 2004 and entered into force in November 2004. The project is being implemented by a consortium of investors - LUKoil Overseas (90%) and Uzbekneftegaz (10%), and the consortium's profit share is 50%.
The PSA is valid for 35 years. The volume of the approved geological reserves of natural gas on the contract area is 329 billion cubic meters. Industrial production will be started in the fourth quarter of 2007. The maximum level of annual gas production will be over 10 billion cu m, and the aggregate accumulated production volume could reach 207 billion cu m, with investment estimated at $1 billion.
