Uzbekistan’s Gazli Gas Storage LLC on March 7 denied media speculation that its $850mn gas storage project was in any way linked to Russian stoligarch Gennady Timchenko in a statement emailed to bne IntelliNews.

The company described the claims made by an RFE/RL investigation as “unfounded and defamatory media speculation alleging hidden interests” held within the company”. Gazli issued the statement “to set the record straight”.

As bne IntelliNews reported, the gas storage project in Uzbekistan is part of the government’s plans to increase gas imports from Russia to bring an end to an energy crisis that has been roiling the country for several years amid strong economic growth that sent the demand for energy soaring.

RFE/RL’s Uzbek Service on March 5 published an article headlined “Uzbek insider takes over gas project linked to sanctioned Russian tycoon closely tied to Putin”. In following up the article, this publication described how the tycoon in question is a stoligarch and close personal friend of Vladimir Putin.

While the article dug into the corporate structures surrounding the gas storage project, RFE/RL failed to show any ownership links between the gas storage project and Timchenko, only alleging that some of the players were “linked” to the oligarch, using the words “linked” and “tied” eight times, without providing any proof of Timchenko’s actual involvement in the deal.

In its statement, Gazli Gas Storage said: “In October 2023, Gazli Gas Storage completed a corporate restructuring resulting in the stake previously held by Russian Forus JSC being transferred to Daxon Holdings Limited, a company incorporated in Hong Kong. [Uzbek energy entrepreneur] Bakhtiyor Fozilov was and remains the main beneficiary of Gazli Gas Storage and no sanctioned individual has ever held a shareholding in the company.

“The decision to relocate to Hong Kong was made due to the significant volume of business with Chinese companies. Relocation to Hong Kong will facilitate payments, attract additional financing, and facilitate procurement of equipment for further business development. Additionally, the restructuring simplifies the shareholding structure, increasing transparency for international investors and counterparts.”

It added: “The main objective of the JV LLC "Gazli Gas Storage" is to increase the volume of gas storage in the underground gas storage facility of the "Gazli" field in combination with additional exploration and development of gas horizons and oil rims of the field.”

The expansion project is focused on Uzbekistan's principal gas field near Gazli in Bukhara region.

The storage initiative is part of the new energy investment plan commenced by Uzbek Prime Minister Abdulla Aripov on February 14.

Uzbekistan’s own gas reserves have not proven sufficient to meet annually surging domestic gas demand.

Under a two-year deal with Gazprom, Uzbekistan’s Russian gas imports will more than quintuple to 9mn cubic metres (mcm) of gas daily. The country’s gas storage facility capacity is to grow from 3bn cubic metres (bcm) to 10bcm by 2025.