Uzbekistan has revoked some oil-field licenses held by Sanoat Energetika Guruhi (Saneg), a major Uzbek private oil and gas producer, after the company failed to develop deposits and meet licensing conditions. The move is another setback for the company, formerly known as Jizzakh Petroleum, following the collapse of its $100 million agreement to purchase the Fergana Oil Refinery.
When the refinery sale was announced in 2022, Saneg was reported to account for approximately 80% of Uzbekistan’s oil production and hold development rights to 103 oil and gas fields. Officials have not said how many licenses have been canceled, which fields are affected, or what impact the decision will have on the company’s operations.
Speaking at an October 8 press conference, Sohibjon Murodov, director of the State Assets Management Agency, said the affected deposits had not been developed and licensing conditions had not been met. He did not disclose when the licenses were canceled.
The Ministry of Mining Industry and Geology is now preparing measures for the affected fields. Asked why Saneg had originally received development rights without competitive auctions, Murodov explained that under the previous system, the first applicant could obtain a license after paying the prescribed fees. Auctions for hydrocarbon licenses were introduced in 2023–2024. He stressed that the deposits themselves had remained state property.
A Privatization Reversed
The government transferred management of the Fergana refinery to Saneg, then operating as Jizzakh Petroleum, in 2020. In May 2022, it announced the $100 million sale, accompanied by a separate commitment to invest $380 million in modernization.
The transaction was intended to address longstanding problems. Reporting at the time described shortages of raw materials and said the refinery had not undergone major modernization or reconstruction for two decades. Saneg’s investment commitments covered improvements to fuel production and processing facilities.
Despite the announced sale, the state still held 58.5% of the refinery in May 2026, while Saneg owned 41.5%. By June, the State Assets Management Agency was its sole owner, according to registry information reported by Interfax.
Explaining the termination in October, Murodov said financial difficulties in the investor’s other projects had prevented it from making purchase payments on time. The contract allowed termination if payments were three months overdue, he said. The agency consulted international legal advisers and notified Saneg before ending the agreement.
Saneg had previously maintained that it had fulfilled its payment and investment obligations, according to Interfax’s June report. However, the amount of the overdue payments remains unclear, as does how earlier payments and investments will be treated and how much modernization work was completed.
State-Directed Debt Recovery
The state had already intervened in January to address financial problems at Saneg, oilfield services company Eriell, and engineering contractor Enter Engineering. Uzbek reporting has linked all three businesses to businessman Bakhtiyor Fozilov.
A January 22 government resolution recorded combined unpaid wages of approximately $131 million owed to 38,700 employees across the three companies, according to reporting by Spot in March.
The government ordered the sale of non-core assets to help repay the debts, with unpaid wages given priority. Assets were to be transferred to Saneg Aktiv for sale, with proceeds deposited in a special bank account and distributed under the direction of a government working group. The measures also covered tax liabilities and loans from unaffiliated banks.
The assets listed for disposal included eight hotels at the Silk Road Samarkand tourism complex, company offices, and a medical center in Tashkent. The measures also restricted the companies’ ability to sell, transfer, or pledge assets independently. Officials were instructed to seek new investors for unfinished strategic projects, including modernization of the Fergana refinery.
Recovery Under State Ownership
On October 5, President Shavkat Mirziyoyev reviewed efforts to improve the refinery’s finances and production. His administration reported that repairs had increased diesel output by 30%, bitumen by 60%, and aviation fuel output to five times its previous level, although it did not specify the comparison period or absolute volumes.
Official accounts differ on how much of the refinery’s capacity is being used. The presidential statement set a target of increasing utilization from 40% to 65% by year-end. Yet Murodov said on October 8 that utilization was already approaching 100%. Neither account explains the discrepancy.
Murodov also said an international audit was underway to establish the refinery’s liabilities and determine how its debts would be repaid or restructured. Another privatization is not currently planned.
Four years after the original sale agreement, the government is once again overseeing efforts to secure the refinery’s raw-material supplies, increase production, and address its debts.
