Temirlan-Oil Refinery Project

Overview & Market Background

The Kyrgyz Republic has been experiencing a prolonged shortage of refined petroleum products. Following the general economic downturn and specifically in the oil sector, this Central Asian country entered the new millennium demonstrating stable growth in demand for petroleum products (about 10% per year). However, the complexity arises because the growing demand is not matched by an equivalent increase in supply.

Over the past 15 years, several new refineries have been built in the Kyrgyz Republic, but there have been no qualitative changes in the market. Despite these additions, the situation remains tight.

Main Problem

All Kyrgyz refineries are located far from crude oil production sites and pipeline routes, and the Kyrgyz Republic's own extractable oil reserves are minimal—insufficient to meet the continuously growing demand. The total refining capacity of the country far exceeds the actual output. The five active Kyrgyz refineries—"Junda" (800,000 t/yr), Tokmok (450,000 t/yr), Kant (300,000 t/yr), "Kyrgyz Petroleum" (300,000 t/yr), and Jalal-Abad (60,000 t/yr)—have a combined capacity nearly 15 times larger than their current production. This mismatch is primarily because of the distances from crude sources and pipeline infrastructure.

Even the existing production capacities do not meet modern standards. Refining depth and product quality are concerning. As the Kyrgyz Republic expanded its nominal refining capacity, the proportion of gasoline and diesel output declined. In 2000, gasoline accounted for over half of total output; currently, about 54% is heavy fuel oil (mazut).

Consequently, the Kyrgyz Republic faces a severe deficit in fuel and lubricants, despite having several refineries. All existing facilities operate below 10% capacity because they lack direct pipeline connections for crude supply and must rely on rail, artificially increasing both raw material and final product costs.

Statistical Charts (2000–2017)

Below are two charts showing crude oil production & imports, alongside petroleum product production & imports in the Kyrgyz Republic from 2000 to 2017.

Source: National Statistical Committee of the Kyrgyz Republic.

Chart 1 - Crude Oil Production and Import (2000-2017)

Chart 2 - Petroleum Products Production and Import (2000-2017)

Project Financing Framework

A credit agreement has been signed in connection with the project.

Formation of the Kazakh–Kyrgyz Commission & the “Maymak” FEZ

A Kazakh–Kyrgyz intergovernmental commission was established to support cross-border industrial cooperation, with Mr. M. D. Orazbayev (General Director of Temirlan-Oil) as one of the key initiators. This institutional work contributed to the project framework and to the creation of the “Maymak” Free Economic Zone (FEZ) in Kara-Buura District of Talas Region.

By a government decree of the Kyrgyz Republic, Temirlan-Oil was tasked with developing the “Maymak” FEZ, allocating specific areas for an oil refinery, a petrochemical plant, a gold mining enterprise, and an agro-industrial complex.

As part of the first phase of the “Maymak” FEZ development plan—constructing the oil refinery—Temirlan-Oil completed all required architectural and planning documentation with the relevant government agencies, built an oil storage facility on the designated land, established the necessary infrastructure, and carried out earthworks up to the main pipeline tie-in point.

Temirlan-Oil also reached agreements with the German government to participate in the “Maymak” FEZ project via a local manufacturer financing program. Under these agreements, German manufacturers are designated as primary equipment suppliers for all development phases of the FEZ, while Euler Hermes Germany is the lead project finance arranger and risk insurer. The German partner, "Temirlan Development GmbH", supports international coordination of the project financing program.

Feedstock & Logistics Concept

The project is designed to assess regional crude-feedstock options and the logistics required for refinery operations. Potential sources and transport solutions are reviewed within the project’s technical and contractual workstreams.

Source identities, volumes, routes, quality parameters and commercial terms are transaction-specific and are not presented here as confirmed public arrangements.

Offtake & Domestic Market

Temirlan-Oil's commercial activities may include the sale of diesel fuel and other petroleum products, subject to product availability, applicable approvals and separate transaction-specific agreements. This website does not represent continuous availability or guaranteed supply.

The Kyrgyz Republic currently has several refineries for processing hydrocarbons into fuel. These include LLC "Kyrgyz Petroleum Company" in Jalal-Abad (300 thousand t/yr), "Russneft" at the refinery in Kant (250 thousand t/yr), and LLC "China Petrol Company Junda" in Kara-Balta (800 thousand t/yr nominal, ~80 thousand t/yr actual). All of them lack reliable crude supply and operate below capacity. Petroleum products (fuel) are therefore imported from Kazakhstan and Russia. In 2014, the Kyrgyz Republic's domestic annual demand was about 3.5 million tons of light petroleum products and 650 thousand tons of heavy petroleum products.

Insurance & Project Implementation

Insurance and risk-management solutions for the project are structured with the involvement of leading international insurance providers. Highly professional specialists and technologists from Russia, Kazakhstan, and Germany have been engaged in project design and implementation.

Under the agreement, the Kyrgyzgiprostroy Design Institute, an open joint-stock company in the Kyrgyz Republic, will act as the general designer. Subcontracting work will be carried out by international engineering companies. The supply and turnkey installation of technological equipment is expected to involve German manufacturers and specialized engineering partners.

German equipment was selected because the technology can be reconfigured for any feedstock parameters across a broad spectrum, as well as adapted to produce various final products. Hence, the refinery can be supplied from multiple crude sources. In case of unforeseen circumstances, complete logistics for the supply of alternative feedstock have been developed for the plant. The necessary infrastructure to accommodate rail deliveries is already in place.

Project Technical & Financial Details

Company & Project
Company Name	Open Joint-Stock Company “Trading and Industrial Company ‘Temirlan-Oil’”
Date of Re-registration	May 12, 1998
Type of Company	Open Joint-Stock Company
Industry	Oil Refining
Founders / Shareholders	M. D. Orazbayev – 100%
Project Location	Free Economic Zone “Maimak”, Kyrgyz Republic
Project Status	Development / Investment Screening. Final technical, EPC and financing parameters remain subject to FEED, contracting and lender confirmation.
Capacity & Ramp-up
Projected Refining Capacity	3,500,000 tonnes per year — current financial-model working case
Ramp-up Profile	70% / 90% / 100% of design capacity during the initial operating ramp-up period
Capital Cost
Plant CAPEX	Approx. US$1,225.6 million
Process Equipment	Approx. US$827.5 million
Offsites, Tankage & Utilities	Approx. US$144.3 million
Crude Pipeline & Refinery Tie-in	Approx. US$19.8 million
External Power Connection	Approx. US$16.5 million
Auxiliary Equipment	Approx. US$3.8 million
Engineering & Project Delivery	Approx. US$101.3 million
Contingency	10% — current management screening case
Other Site Facilities	Approx. US$1.1 million
Funding & Financing
Gross Project Funding Requirement	Approx. US$1,373.5 million, before financing costs
Current Financing Structure — Model Case	100% core senior debt / 0% core equity
Core Senior Term Commitment	Approx. US$1,304.6 million
Capitalized Interest During Construction	Approx. US$111.0 million
Senior Term Debt at COD	Approx. US$1,415.6 million
Working-Capital Facility at Start of Operations	Approx. US$68.9 million
Total Senior Exposure at COD	Approx. US$1,484.5 million
Financing Rate — Current Model Case	SOFR + 2.0% margin; current model reference all-in rate approximately 5.64%
Upfront Fee	1.0% of the senior term commitment
Commitment Fee	0.5% per annum on the undrawn committed amount
Loan Period	12 years — current financial-model assumption
Grace Period	3 years
Debt Service Reserve	6 months of scheduled debt service
Target Debt Service Coverage Ratio	1.35x
Operating & Financial Performance
First Full-Capacity Operating Year	2030 — current financial-model case
Revenue — First Full-Capacity Year	Approx. US$2,446.2 million
Cash Cost of Goods Sold — First Full-Capacity Year	Approx. US$1,941.3 million
Gross Operating Profit — First Full-Capacity Year	Approx. US$504.9 million
EBITDA — First Full-Capacity Year	Approx. US$446.2 million
Project Payback	2031, approximately 5 years from the start of the financial-model horizon
Discounted Payback	2033
Project Discount Rate / WACC	Approx. 9.68%
Project NPV	Approx. US$1.10 billion on the 2026–2042 project horizon
Project IRR	Approx. 21.7%
Commercial & Implementation
Sales Allocation — Current Model Case	30% Kyrgyz Republic / 70% export markets
Product Sales Basis	FCA / ex-refinery Maimak; onward transportation from the refinery is borne by the buyer
Target Markets	Kyrgyz Republic and selected regional export markets, including Uzbekistan and Afghanistan; other regional markets remain subject to commercial validation
Planned Staffing	Approx. 320 employees in the current financial-model screening case; subject to final operating organization and staffing plan
Planned Products	Gasoline, diesel, kerosene / aviation fuel, fuel oil, bitumen and LPG, subject to final process configuration and approved engineering documentation
Feedstock Supply	Multiple regional crude-supply sources are being assessed. Final volumes, pricing formulas and supply terms remain subject to project-specific commercial agreements.
Equipment / EPC Status	Final equipment suppliers, licensors, EPC contractor and contracting structure remain subject to FEED, vendor selection and negotiations
Indicative Implementation Period	12–18 months, subject to final FEED / EPC schedule confirmation
Project Financing Status	Project financing is being structured with potential financing partners. The current financial model assumes a 100% core-debt financing case, subject to lender due diligence, credit approval and final financing documentation.

Geolocation: “Maymak” FEZ

The marker sits on the company’s administrative building at the project site in the “Maymak” Free Economic Zone. It marks the location, not a surveyed site boundary.

Project site · “Maymak” FEZ · Talas Region · Kyrgyz Republic

42.722818° N · 71.273877° E