Uzbekistan will upgrade its gas transmission system with a $10.6 million World Bank grant to reduce leakage from infrastructure supplying roughly 80% of the country’s energy needs, according to the International Energy Agency (IEA).
Underinvestment in maintenance has deteriorated Uzbekistan’s gas infrastructure to the extent that the volume of gas leaked into the atmosphere is forecast to reach 1.75 Bcm by 2030, resulting in $228 million in lost revenues, the World Bank noted in a press release announcing the grant’s approval.
The Uzbekistan Gas Leak Repair Facility Project, funded by the World Bank’s Global Flaring and Methane Reduction (GFMR) Trust Fund, aims to detect and fix major leaks across the state-owned gas transmission network operated by JSC Uztransgaz (UTG).
Uzbekistan reduced its flaring profile by 76% between 2012 and 2022 and ranked No. 1 among nations that had significantly reduced flared emissions over those 10 years, according to the Canadian Energy Center.
Uzbekistan Targets Methane Emissions From Space
But methane emissions from leaky infrastructure still stands out on satellite imagery which Uzbek authorities plan to leverage with World Bank funding. In March, the Uzbek Space Agency partnered with Canada’s GHGSat to build out a satellite-based emissions monitoring program, according to Uzbekistan’s private media outlet, gazeta.uz.
“A more efficient gas transmission network will turn waste into value, freeing up more domestically produced and affordable energy for people and businesses in Uzbekistan,” Najy Benhassine, director of the World Bank Division for Central Asia, said in a press release.
“Reducing losses in the gas network will provide substantial savings and economic gains,” he added. By 2029, repairs are expected to recover an estimated 47,500 mtpa of gas for domestic use, according to the World Bank.
Turning Leak Reduction Into Long-Term Gains
An expected $18 million in financial savings would be mostly reinvested in long-term leak detection and repair efforts to maintain and improve UTG’s gas transmission system.
“Fixing leaks from gas infrastructure is relatively easy and provides multiple benefits,” Zubin Bamji, program manager, Global Flaring and Methane Reduction Trust Fund, World Bank Group Energy Global Department, said.
“In addition to boosting government revenues and energy security, this new project will create jobs and a safer operating environment, while reducing harmful emissions,” he added.
The GFMR grant will fund long-term gas capture initiatives through a financial facility managed by Uzbekistan’s Ministry of Economy and Finance and replenished through project savings to finance ongoing work across UTG’s gas transmission infrastructure.
The project will also support advanced equipment and training for UTG and assist in setting top-tier reporting and measurement standards for methane emissions, according to the World Bank.
GFMR is a multi-donor initiative supported by governments, companies, and multilateral organizations, aimed at ending routine gas flaring and reducing methane emissions from the oil and gas sector.
Lukoil, Gazprom, and China National Petroleum Corporation rank among the most heavily invested foreign companies in Uzbekistan's oil and gas sector, reflecting their long-standing production-sharing agreements and joint-venture agreements, according to the US Energy Information Administration.