Uzbekistan Law on Subsoil LRU-987 — wholesale recodification of mining and subsoil regime

Mechanism

LRU-987 replaces the prior 51-article subsoil law (LRU-444, adopted 2017) with a 172-article comprehensive recodification of Uzbekistan's subsoil regime, covering both hard minerals and hydrocarbons. Core changes:

• Licensing. Tiered licensing architecture distinguishing exploration,

appraisal, development, and combined licences. Auction- and tender-based award procedures with published terms; transparent rules for licence extension, transfer, and revocation. Provisions for "geological-exploration licences at the investor's risk" intended to draw Western juniors.

• Royalty / fiscal terms. New royalty architecture for hard minerals

with rate differentiation by commodity class (rare earths, base metals, precious metals, hydrocarbons). Provisions for negotiated production- sharing agreements (PSAs) for strategic projects.

• Foreign-investor terms. Explicit non-discrimination between

domestic and foreign licence holders; provisions on stabilisation, international arbitration, and protections aligned with EBRD-engaged drafting standards.

• Critical-minerals focus. New chapter on "minerals of strategic

importance" (rare earths, lithium, tungsten, molybdenum, antimony, graphite, etc.) with priority access procedures for projects aligned with state critical-minerals programmes.

• EBRD involvement. Drafting was developed in collaboration with

EBRD experts as part of EBRD's €938m 2024 country-engagement package.

The August 2025 LRU-1080 conforming-amendments omnibus aligns Uzbekistan's tax code, licensing law, and environmental code with the new subsoil regime, enabling full operationalisation.

Downstream implications

• Foundational legal infrastructure for Uzbekistan's downstream critical-

minerals push: the March 2025 $2.6bn critical-minerals programme (already filed) operates within the LRU-987 framework.

• Strategic anchor for the Almalyk MMC and Navoi MMC IPO track (parent

instrument: Uzbekistan-2030 Strategy DP-158 of September 2023, with DP-37 of February 2024 operationalising annual targets) — both SOEs require stable, internationally-credible subsoil-regime terms to attract IPO investors and JV partners.

• Signals to Western mining capital (US, EU, Japan, Korea) and DFIs (DFC,

KfW, JBIC, KEXIM) that UZ subsoil regime is being modernised to meet international good-practice standards.

• Supports the US-Uzbekistan critical-minerals MoU (Feb 2026) and DFC

joint-investment framework (already filed) — those instruments rely on the underlying UZ subsoil-law modernisation to be commercially executable.

Open questions

• Implementation pace of the new royalty architecture: which strategic-

project PSAs will be the first negotiated under LRU-987, and on what terms?

• Resolution of overlapping licences inherited from the LRU-444 regime —

transition provisions and timeline.

• Interaction with the export-control / counter-obligations regime to be

developed for strategic critical minerals (parallel to Kazakhstan's REE Comprehensive Plan 2024-2028 architecture).