FINANCING INDUSTRIAL SECTOR PROJECTS IN UZBEKISTAN April 2013

FINANCING INDUSTRIAL SECTOR PROJECTS IN UZBEKISTAN April 2013 Fund for Reconstruction and Development of Uzbekistan

State programs aimed at industrial development and modernization 1. Industrial development priorities program #PP-1142 for 2011 -2015 (with total of 500 projects for over 47 bln. US dollars) 2. Industrial infrastructure program #PP-1446 for 2011 -2015 (with total 85 projects for over 8. 5 bln. US dollars) 3. 16 Sectoral development programs in (oil and gas, chemical, energy, textiles, leather and foot-wear industry and etc. ); 4. Projects implemented in special industrial zones (Navoi, Angren, Jizzakh); 5. Small and Medium size investment projects support by commercial banks, non bank financial institutions and other sources; 6. Annual investment program of Uzbekistan #PP 1855 for 2013; (Total of 293 large projects) Fund for Reconstruction and Development of Uzbekistan 1

Investment projects financing breakdown by source in Uzbekistan in 2012 Fund for Reconstruction and Development of Uzbekistan 2

About UFRD n Established in 2006 by the Presidential Decree n Charter capital 15 billion U. S. Dollars n UFRD’s participation ensures successful accomplishment of national projects n UFRD provides assistance with its expertise, analysis and liaison with local institutions at all levels Fund for Reconstruction and Development of Uzbekistan 3

Areas of Financing Areas: n Oil and Gas n Chemical and Petrochemical n Energy & Power n Metals & Mining n Transport & Communications n Infrastructure Fund for Reconstruction and Development of Uzbekistan 4

Major objectives n Financing and co-financing investment projects with major contribution to economic development and structural reforms n Providing loans for modernizing industrial enterprises in the key sectors of the economy n Introduction of advanced, efficient and energy saving technologies n Contribution to sustainable growth Fund for Reconstruction and Development of Uzbekistan 5

Project stages Appraisal Feasibility studies, Due diligence, appraisal, (co) financing mechanism Final review, Government approval, Board approval Financing Implementation Supervision, implementation monitoring Monitoring Completion and evaluation Fund for Reconstruction and Development of Uzbekistan 6

Project financing mechanism UFRD Investors CO-FINANCING BANKS Financial Institutions, Banks and Investors n Refinancing n Monitoring n 5 authorised banks BORROWERS Loans provided for designated projects Fund for Reconstruction and Development of Uzbekistan 7

Portfolio structure UZTRANSGAZ Projects portfolio: 77 projects - $24. 86 bln. in total, with the participation of UFRD - $5. 3 bln. Fund for Reconstruction and Development of Uzbekistan 8

Surgil gas chemical complex Description Project information Construction of Gas and Petrochemical Complex on the Ustyurt Surgil deposit with further field development n Value: over $4 bln. n Completion: 2015 n The project's outcome is a significant expansion in the value-added chemical process industry in Uzbekistan and the increase in value of a key natural resource. As a result, 3, 373 KTPA of natural gas will be processed into 387 KTPA of high-density polyethylene, 83 KTPA of polypropylene, and 2, 568 KTPA of methane-rich processed gas. The project will boost long-term employment by adding approximately 3, 500 direct jobs during construction and 1, 090 during operations, in addition to indirect employment opportunities. n Shareholders: Kogas, Lotte, Uzbekneftegaz n Uz-Kor Gas Chemical is a joint-venture company which is 50% owned by Uzbekistan’s UNG and 50% by a consortium of Korean companies: Uz-Kor Gas Chemical was incorporated in Uzbekistan in May 2008 as a project company to build, own, and operate the project. n A consortium of foreign banks, including the Asian Development Bank, the Export-Import Bank of Korea, China Development Bank and others, are providing loans for a total of $2. 54 billion for 16 years. Fund for Reconstruction and Development of Uzbekistan 9

Project implementation Dehkanabad Potash Fertilizer Plant (2007) Resources Potash salt deposit Tyubegatan Co-Financing Eximbank of China $42 mln. EPC International Contractors UFRD $62 mln. Uzkimyosanoat $22 mln. Results Future expansion to production of 600 000 tons of potash fertilizers Export of 200 000 tons of potash fertilizers 1321 new jobs Area infrastructure 2 nd stage of project started in 2011 Modern Technologies Fund for Reconstruction and Development of Uzbekistan 10

Oltin Yol GTL Description Project information n Value: $4 bln. n Completion: 2015 n Shareholders: Uzbekneftegaz, Sasol, Petronas Production of synthetic liquefied gas (GTL) on the base of methane processing at Shurtan Gas-Chemical Complex n Gas to liquids (GTL) is a refinery process to convert natural gas or other gaseous hydrocarbons into longer-chain hydrocarbons such as gasoline or diesel fuel. Methane-rich gases are converted into liquid synthetic fuels either via direct conversion or via syngas as an intermediate, for example using the Fischer Tropsch or Mobil processes. n South African energy and chemicals group Sasol concluded a joint venture (JV) agreement with Uzbekistan's national oil and gas company, Uzbekneftegaz, as well as with Petronas, of Malaysia, for the development of a new $3, 985 -billion gas-to-liquids (GTL) project. n (GTL) plant, located 40 kilometers south of Qarshi in Uzbekistan. This plant will be based on Sasol’s world leading GTL technology and will have a capacity of 1. 4 million metric tons per year, a similar capacity of the Oryx GTL facility in Qatar implemented by Technip, with following product slate: GTL diesel, kerosene, naphtha and liquid petroleum gas. The plant, would tap into gas reserves of some 60 -trillion cubic feet (tcf), with a typical GTL plant requiring only 3, 5 tcf. n The facility could produce some of 1, 4 -million tons, or 40 000 bbl/d, of GTL diesel, kerosene, naphtha and liquefied petroleum gas according to Sasol. Fund for Reconstruction and Development of Uzbekistan 11

Talimarjan TPP Description Project information n Value: over $1. 28 bln. Extension of Talimarjon TPP with the construction of 2 units of CCGT capacity of 450 MW each n Completion: 2015 n The aim of the project - the introduction of two blocks of steam-gas Combined Cycle Generating Turbine plants (CCGT) at Talimarjon TPP of 450 MW each. n Shareholders: Uzbekenergo n Generation: 900 MW n The project will ensure reliability, efficiency, reducing the unit cost of energy (including gas) and electricity, reducing the impact on the environment. n Ensuring a reliable supply of electric energy to consumers of the southern regions of Uzbekistan. n Estimated power: the installation of two units, each with a capacity of CCGT 450 MW / h will allow output of 6, 088 GWh of electricity annually. n Steam-gas installations and associated equipment manufactured by leading engineering firms in Germany, Japan and USA. n The project initiator - Uzbekenergo. n Total project cost – 1. 280 billion dollars. Fund for Reconstruction and Development of Uzbekistan 12

Air fleet modernization of “Uzbekistan Airways” Description Project information n Value: over $1. 1 bln. n Completion: 2018 n Shareholders: Uzbekistan Airways n Uzbekistan Airways is the country’s airline, which provides aviation needs for the national economy. n Uzbekistan Airways/National Air Company (NAC) was founded on January 28, 1992. Soon after the airline's establishment the development of the state civil aviation program has begun. n The program included complete reconstruction of airport terminal complexes, equipping airports in accordance with International Civil Aviation Organization (ICAO) requirements and establishment of a base for training of professional personnel. n Today Uzbekistan Airways is the leading carrier in the Central Asian region. Uzbekistan Airways keeps a sound position on the international market and provides high quality competitive services. During the years of operation the company had been awarded the International fund for Aviation Safety Diploma and a Certificate from Airports International Association and "Euromarket-2000“. n The company operates flights to more than forty cities of the world including North America, Europe, Middle East, Southeast, Central Asia and the CIS. Uzbekistan Airways continues to establish long-term and reliable business contacts, to increase the number of countries where its aircraft flies to and to improves its services. That makes the company one of the world's dynamic airlines. n Currently UFRD co-financing acquisition of 16 planes from Airbus. Fund for Reconstruction and Development of Uzbekistan 13

Perspective projects for co-financing and investments Construction of the ammonia and urea plant in Navoi region n Estimated cost: $900 -1050 mln. n Output: ammonia -2000 tons/day, Urea-3000 tons/day Construction of new polyvinyl chloride (PVC) and caustic soda producing plant n Estimated cost : $468 mln. n Output: PVC -100 thousand tons/year Fund for Reconstruction and Development of Uzbekistan

Perspective projects for co-financing and investments Construction of combined cycle power plant with total capacity of 900 MW in the Namangan region n Estimated cost: $1000 mln. n Output: PVC -100 thousand tons/year Construction of Gas-petrochemical complex at Mubarek n Estimated cost: $4000 mln. n Output: Polyethylene - 400 000 thousand tons/year Fund for Reconstruction and Development of Uzbekistan

Our partners n Asian Development Bank n World Bank n Japan International Cooperation Agency n Islamic Development Bank n State General Reserve Fund of Oman n Korea Development Bank n Korea Export-Import Bank n International Petroleum Investment Company n KSURE n Malaysia Export-Import Bank n China Development Bank n The Export – Import Bank of China n Kuwait Fund for Arab Economic Development Fund for Reconstruction and Development of Uzbekistan 16

Fund for Reconstruction and Development of Uzbekistan Contact Details: E-Mail address: info@ufrd. uz +998 71 2385648 (Fax) +998 71 234 0157 Address: 101 Amir Temur Street, Tashkent, Uzbekistan, 100084 Web address: http: //ufrd. uz Fund for Reconstruction and Development of Uzbekistan 17