1. along the existing collectors Comprehensive Solution for Flaring Gases Issue at the Facilities of the Unitary SC ShurtanNeftegaz By Rakhmatilla Rajabov, Chief Expert on Technologies

2. УДП «Шуртаннефтегаз» As known, the solution of the issue to utilize associated gases implies the concurrence of three components, i.e. environmental, economic and technological. Unlike natural gas which consists mostly of methane, associated oil gases contain considerable part of ethane, propane, butane and other saturated hydrocarbons. Additionally there is a water vapor, nitrogen, carbon dioxide, and hydrogen sulphide. Currently oil producing enterprises have no facilities to completely utilize APG. It is caused by the absence of technologies, the introduction of which would be justified from the viewpoint of economic efficiency.

3. УДП «Шуртаннефтегаз» Therefore more often than not APG is flared which is accompanied by the formation of carbon black, dioxides and other combustion gases. This results in environmental pollution, excessive environmental loading on venting, and inflicts a destructive harm to human health. This problem also exists at the oil-extracting facility of the Unitary Enterprise UDP Shurtanneftegaz situated on 19 production fields of the Kashkadarya Region. I represent that facility.

4. УДП «Шуртаннефтегаз» In practice APG are utilized by using them for one’s own needs. Thus, at the Oil Treatment Plant Tashly of the Sarycha field oil gas is used as fuel gas for petroleum pre-heater. At the same time, it should be noted that the given method does not prevent flaring due to considerable volumes of oil gas. However, there are other ways to utilize oil gas which do not require significant expenditures. In March, 2009 we have accepted a most common solution to utilize petroleum gas of the Northern Shurtan field, i.e. a 12 kilometer pipeline was laid from the field to the principal facilities of the GPP, and this facilitated the utilization of up to 95% from the total volume. Oil gas is utilized in the same way at the Shakarbulak field as well. Potential ways to solve the issue of utilizing APG

5. Degasifier Reservoir -2 Evaporation pond Petroleum pipeline to OTP of tube heater Diagram of oil processing at the Oil Treatment Facility of the Northern Shurtan field Oil wells O&G mixture Gas to GPP Gas to FND Oil+water С-1 Oil extracted from wells is transported to the high pressure separator С-1. Oil gas from Northern Shurtan field under pressure of P=3.4MPa is delivered from the upper part of the separator to the SP-4 of the Oil Gas Unit-2; subsequently gas is transported along the existing collectors for further treatment and processing.

6. Reservoir-1Reservoir -2 Evaporation pond Petroleum pipeline to OTP of tube heater Diagram of oil processing at the Oil Treatment Plant of Shakarbulak Field Oil wells Oil+Gas mixture Gas to GPP Gas to FND Oilfield water Oil+water

7. УДП «Шуртаннефтегаз» Currently work is going on at the UCS ShurtanNeftegaz to implement the project Recovery and Utilization of APG from Northern Shurtan, Garmistan, Kumchuk, Shakarbulak Fields, and degasified gases from the Headworks. This project stipulates construction of gathering facilities as well as booster compressor stations to compress APG and degasifying gases from the headworks of the UCS ShurtanNeftegaz for their further treatment and extraction of useful components. 7

8. УДП «Шуртаннефтегаз» It is suggested to implement the project in two stages: First stage is a construction of BCS at the Northern Shurtan field and the Headworks along with the assembly of gas collector from Garmiston and Kumchuk fields to the BCS Northern Shurtan. Second stage is a construction of the BCS at Shakarbulak, Garmiston and Kumchuk fields.

9. УДП «Шуртаннефтегаз» APG from Northern Shurtan field will be transported by pipeline to the BCS Northern Shurtan at the Р=0.1 МPа; gas from the BCS Northern Shurtan will be delivered to the inlet of the BCS Headworks at Р=1.0 МPа. In addition to oil gas, degasified gases from the Headworks will be delivered in three streams (at different pressures Р 1 =0.4 МPа; Р 2 =1.8 МPа; Р 3 =4.8 МPа) to the inlet of the BCS Headworks. From the BCS Headworks oil gas and flash gases are transported to the UNTS of 1 st and 2 nd stages at P=7.5 MPa. Description of utilization plan

10. УДП «Шуртаннефтегаз» While comparing cost of investment project for the prudent management of APG, which includes expenditures to build production facilities, purchase and assembly of equipment, cost of maintenance with the amounts of environmental payments and penalties imposed for flaring, it becomes evident that currently it is easier for oil company to pay penalties than to invest into a knowingly unprofitable project. Nevertheless, taking into account the damage inflicted to the environment and human health, it is necessary to focus efforts directed to the reduction, and when possible to the elimination of flaring; and this we are hoping to achieve while actively cooperating with GGFR.

11. Thank you for your attention! УДП «Шуртаннефтегаз»