Uzbekneftegaz tightens control over joint ventures after output decline
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Uzbekneftegaz has begun systematic audits and tighter oversight of its joint ventures, citing declining production, investment inefficiency, and unpaid dividends. The decision was announced at a meeting chaired by CEO Abdugani Sanginov on August 24. The company said it will require all JV activities to be approved by Uzbekneftegaz and will review dividend policies for 2025-2026.
Key Facts
- Uzbekneftegaz announced the tightening of control over joint ventures at a meeting chaired by CEO Abdugani Sanginov on August 24.
- The joint ventures under review include Natural Gas-Stream, New Silk Road Oil and Gas, and ANDIJANPETRO, each with Uzbekneftegaz holding a 50% stake.
- Uzbekneftegaz cited declining production, inefficient use of investment funds, lack of financial stability, and incomplete dividend payments as key problems.
- The company will require all JV activities, investment projects, and work processes to be approved by Uzbekneftegaz after thorough analysis of necessity, economic efficiency, and cost.
- Uzbekneftegaz set tasks to ensure full and timely dividend payments for 2025-2026 and to eliminate existing debts.
Joint Venture Oversight
Uzbekneftegaz has begun systematic audits and strengthened control over joint ventures in which it holds a stake, according to the company's press service. At a meeting chaired by CEO Abdugani Sanginov, the activities of Natural Gas-Stream, New Silk Road Oil and Gas, and ANDIJANPETRO were critically reviewed. Uzbekneftegaz holds a 50% stake in each of these ventures, with partners including Natural Gas Stream Holding, China's CNODC, and Russia's Zarubezhneft Eurasia. The company identified insufficient regulation of work processes, lack of transparency in accounting and financial reporting, and incomplete accountability mechanisms. These shortcomings led to year-on-year production declines, questions about investment efficiency, financial instability, and unfulfilled dividend obligations.
New Control Measures
Uzbekneftegaz admitted that the founder had not established adequate control over the enterprises, which allowed problems to escalate. The company's management declared that such an approach will no longer be tolerated and that strict adherence to corporate governance principles is now required. Production capacities, geological exploration, and geological-technical measures will be re-analyzed for efficiency. Measures were set to inventory existing debts and digitize the system for controlling financial flows and procurement. Every planned activity, investment project, and work process in joint ventures must be agreed with Uzbekneftegaz after deep analysis of necessity, economic efficiency, and cost.
Dividend Policy Review
Uzbekneftegaz will review the financial condition and dividend policy of enterprises in which it holds a stake. Tasks were set to ensure full and timely dividend payments for 2025-2026, eliminate existing debts, and systematically monitor future obligations. The company stated that these measures aim to prevent misuse or inefficient use of funds and establish effective control over every expense and decision.
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Uzbekneftegaz tightens control over joint ventures after output decline
