"There is no cost overstatement": Uzbekneftegaz comments on contract for emergency response in Baysun

"No cost inflation." Uzbekneftegaz on the contract for the elimination of the Baysun accident

The state oil and gas company Uzbekneftegaz chose not to disclose the cost of the contract with China's CCDC to clear up the accident at the "25 Years of Independence" (M-25) gas field in the Boysun district of the Surkhandarya region, citing a confidentiality agreement.

Representatives of Uzbekneftegaz stated this at a press conference on October 27, responding to journalists' questions regarding the progress of eliminating the accident at the M-25 field, where gas emissions with a high hydrogen sulfide content have been ongoing since September 2024.

According to the company's chief geologist, Nodir Mukhiddinov, proposals from several foreign companies with experience working with complex oil and gas wells were considered to resolve the emergency situation.

"We held negotiations with several technologically strong companies involved in solving such problems. Among them were companies from the USA, China, and Russia. We reviewed various technical solutions proposed by these companies," he said.

When selecting the contractor, technological risks, the reliability of the proposed solution, the timeframes for completing the work, the cost, and experience in eliminating similar accidents were taken into account.

According to Mukhiddinov, Uzbekneftegaz specialists and engaged consultants considered the proposal of China's CCDC, a subsidiary of the state corporation CNPC, to be the most suitable.

"The main criteria were the optimality of the technological solution, timeframes, risks, and the proposed cost. Most importantly — the company's experience in eliminating similar accidents, including at fields with similar conditions in nearby regions," the chief geologist explained.

When asked by a journalist how much Uzbekneftegaz would pay the Chinese company to eliminate the consequences of the accident, representatives of the state company refused to name the amount.

"The cost is confidential information. A non-disclosure agreement (NDA) has been signed between the two companies. Therefore, before disclosing any figures, we must obtain the consent of the other party," explained Abrorjon Khudoyberganov, Deputy Chairman of the Board of Uzbekneftegaz for Refining.

At the same time, representatives of Uzbekneftegaz emphasized that work has already begun, including the delivery of the necessary equipment.

He also assured that when selecting the contractor, not only technical parameters were taken into account, but also financial conditions.

"You can be sure that there is no artificial cost inflation here. The decision was made after passing all necessary expert reviews and obtaining conclusions from the relevant state organizations," Khudoyberganov stated.

According to the company's press secretary, Mumin Ibodov, the Chairman of the Board of Uzbekneftegaz, Abdugani Sanginov, repeatedly sent contractor proposals back for revision due to cost or non-compliance with other requirements.

The company noted that the main task remains the fastest possible elimination of the accident's consequences and creating conditions for the further development of the field.

It should be recalled that in June 2026, the Chairman of the Board of Uzbekneftegaz, Abdugani Sanginov, reported that it is planned to completely eliminate the accident at the M-25 field in the first half of 2027.

According to him, this requires drilling four additional relief wells. China's CCDC was brought in after studying proposals from foreign companies.

Sanginov also noted that settlements with the Chinese partners would be made in monetary funds, and the transfer of natural resources as payment is not envisaged.

On August 15, 2026, Uzbekneftegaz announced the official start of practical work to cap emergency well No. 604 near the village of Kofrun. The event was attended by the Chairman of the Board of the company Abdugani Sanginov, the khokim of the Boysun district Bahodir Shukurov, and representatives of CNPC. Local residents were presented with a month-by-month work plan to eliminate the accident.

According to the information published at the time, more than 40 units of special machinery and drilling equipment are planned to be delivered to the field from China by the end of 2026. Deliveries of equipment from other countries adapted to work with gas under high pressure and significant hydrogen sulfide content are also provided for.

Drilling operations were scheduled to begin in January 2027, with the accident elimination to be completed by July 2027.

On October 20, Sanginov discussed the progress of the work with the leadership of CNPC. The report on the meeting noted that drilling special wells is provided for to stop the uncontrolled gas blowout.

According to the Ministry of Emergency Situations, the cause was a breach of the technological process. Due to the potential threat, residents of nearby settlements were evacuated.

On September 15, the company Eriell, which performed drilling operations at the field, reported the completion of the well-killing operations. Specialists from Russia and the USA were engaged to eliminate the accident. However, on September 17, a repeated blowout of hydrogen sulfide under high pressure occurred. As a result of the accident, four people died — employees of a contracting organization. Several other workers were injured and sought medical help.

The then Minister of Energy, Jurabek Mirzamahmudov, explained the complexity of eliminating the accident by the specifics of the field.

Reservoir pressure at M-25 reaches 65 MPa (about 650 atmospheres), and the temperature is 150 degrees. The gas contains significant amounts of hydrogen sulfide and carbon dioxide, which requires the use of special equipment and materials resistant to high temperatures, pressure, and corrosion.

Subsequently, new gas blowouts and fires were repeatedly recorded at the field. In March 2025, a hydrogen sulfide blowout occurred at well No. 202, after which the gas was set on fire to prevent its spread into the atmosphere.

The "25 Years of Independence" (M-25) field is considered one of the largest undeveloped gas fields in the country. Its reserves were previously estimated at more than 150 billion cubic meters of natural gas. A significant portion of the reserves contains high concentrations of hydrogen sulfide and carbon dioxide.

In 2017, the government of Uzbekistan signed a production sharing agreement with an investor consortium for the appraisal and development of the field, as well as the construction of a gas chemical complex in the Surkhandarya region.

The total cost of the project was estimated at $5.8 billion, including $2.9 billion for the construction of a gas chemical complex with a capacity of 5 billion cubic meters of gas per year. Surhan Gas Chemical Operating Company acts as the project operator. Drilling operations were carried out by Eriell, while the construction of the gas chemical complex and infrastructure was entrusted to Enter Engineering.

According to data published in November 2023, about $1.45 billion had been invested in the development of the field, and 20 wells had been drilled, 11 of which had undergone testing.

In February 2026, during a trip to the Surkhandarya region, President Shavkat Mirziyoyev stated that a technological solution had been found to resolve the emergency situation. "We will both stop the accident and launch the project, which will give a powerful boost to the economy of Surkhandarya," the head of state said at the time.

Despite the start of work involving Chinese specialists and the announced timeframes for eliminating the accident, the cost of clearing up its consequences remains unknown. The total expenses for emergency work since September 2024 and the estimate of the volume of lost gas have not been published either.