A. Project Opportunity Description

А1. Project Name

(а) Short name: Heavy oil residue hydrocracking plant

(b) Full name: Construction of the heavy oil residue hydrocracking plant at JSC «Mozyr Oil Refinery»

(c) Summary: The aim of this project is to produce an additional volume of motor fuels due to the oil residue conversion.

A2. Project Status

Investment stage. Base and architectural designs are developed. A contract on development of a building project is signed. Negotiations on purchase of reactors are carried on. Investors are invited.

A3. Organizations involved and their roles

(а) JSC «Mozyr Oil Refinery» – the initiator of the project, the borrower

Mozyr-11, 247760, Gomel region, Republic of Belarus.

A.A.Kupriyanov, General director

tеl. (+375 2351) 73220, fax (+ 375 2351) 30543, E-mail: office@mnpz.by

А4. Project Description (approaches, objectives, components, results, stages, time, financing, advantages, influence on transient processes in economics, etc.)

 The particular feature and advantage of the fluid bed hydrocracking process is the possibility to renew the catalyst during the operation, which provides the opportunity to process virtually any heavy residue at the constant pressure drop and other process variables during the whole turnaround period. The planned volume of heavy oil residue conversion is 3000 thousand tons per annum.

А5. Background / history / overall program / related or similar projects

Main products are motor gasoline, including high-octane gasoline, different fuels, including environmental friendly diesel fuel with sulphur content of 0,005, household gas, technical butane, isopentane, vacuum gasoil, bitumen, sulphur. From 2003 the refinery has an ISO 9001-2000 Quality Certificate. The share of certified products makes up 95% of the total output.

А6. Environmental impact summary

Assessment of the environmental impact requires an additional study.

А7. Possible obstacles/ problems/ risk assessment

The following factors have a positive impact on the risk of project implementation: – JSC «Mozyr Oil Refinery» is sufficiently stable financially and has a good credit history. – The principal crude-oil supplier is JSC «NGK «Slavneft», which is a shareholder of the refinery. Besides, the alternative crude oil suppliers are elaborated. – Guaranteed sales of products both in the foreign and domestic markets.

А8. Project implementation and recoupment period

Term of realization 8 years

А9. The branch of industry the Project belongs to

Oil refining branch

B. Capital Cost Items (total investment required for the Project realization)

В1. Project physical components (equipment, works, services, etc. required for the Project implementation)

В2. Capital cost, mln USD

Design and engineering

131

Purchase of equipment and materials

430,7

Building and assembly works, commissioning works

331,9

TOTAL

893,6

С. Capital (as per its source of origin) to be available from the project initiator, owners,  copartners, sponsors)

С1. Type of sources

C2. Amount, mln USD

Own funds

288,6

D. Investments required. Insufficient means

D1. Lack of required funds, type of financial assistance (credit, share interest and e.t.c)

Lack of required funds is  288,6 mln USD Type of financial assistance— crediting

D2. Sources of financing

D3.Type of  financial instrument

D4. Amount, mln USD

Investor's funds

Credit

605

Е. Demand (Consumers) and revenues

Е1. Type of consumers/markets, volumes, prices, revenues, profits/savings:

The products planned under the project: low-sulphur heating fuel according to ISO 8217, increase in the gasoline production by 200’000. tons, increase in diesel fuel production according to Euro 5 by 1 mln. tons.

Е2. Revenue (Sales)

Е3. Amount, mln USD

315,2

F. Operating and Maintenance Expenses

F1. Expenses components, expenses cover strategy, organization of production

The refinery has engineering services and energy sources required for the production. Additional allotment of land is not required.

F2. Cost items

F3. Amount,  mln USD

285,6

G. Net Income Value

G3. Receipts E2 less operating expenses F2

G4. Amount, mln USD

29/6

H. Source of Information about the Project

Н1. This form is filled in by (Name, position):

Priko V.N., Head of bureau on planning, control and information

H2. Organization (name and address):

JSC «Mozyr Oil Refinery» Mozyr-11, 247760, Gomel region, Republic of Belarus.

H3. Теl/Fax/ Е-mail:

+375 2351 74630, E-mail: OFFICE@MNPZ.by

H4. Date: 2009

H5. Departmental identity of the Project: concern "Belneftekhim"