In 2006, SOCAR produced from offshore and onshore fields about 7.84 million tones of oil and 4.34 billion cubic meters of gas. Evident in the presence of more than 61,000 personnels of the company took place in the exploration and exploitation of oil and gas fields in Azerbaijan.
With the tremendous experience and high specialized specialists the company recently been independently operating its own fields, and now intends to elevate its activities to the international level. It should be noted that in the Soviet times, Azerbaijan had experience in exploration and exploitation oil on the territory of the former Soviet Union and in the other countries. The oil company wishes to restore the lost tradition and move to new steps of economic activity by converting from the national to the trans-national company. After independence, Azerbaijan already had some experience in conducting international operations which was initiated by the private company AZRETROL which actively took part in energy projects in Moldova.
SOCAR has already realized some projects in the Caspian Sea for the other Caspian states, and in other parts of the world-particularly in Africa and Asian countries. But the first state where SOCAR intends to conduct its activities for its own is logically can be Azerbaijan’s geographic neighbor and strategic partner Georgia. SOCAR acquired nearly 100 hectares in the Kulevi Terminal located on the shores of the Black Sea. In addition to that, the Georgian government added further 200 hectares to the territory of the terminal.
The company intends to produce refineries to be displayed on the Black Sea in the future, with the possibility of exporting oil to the seaside Black Sea states. It should be noted that currently power of the transshipment of the Kulevi terminal is 10 million tons (2 million tons of oil, 3.0 million tons of diesel, 4 million tones of fuel oil). It’s planned to increase the handling capacity of the terminal to 20 million tons, and increase the tank fleet to 380 thousand cubic meters. The four rail terminal delivery 168 tanks. Construction of the terminal also has laboratory on the quality of petroleum and petroleum products in accordance with international standards, and mobile fleet of nine support service vessels.
Currently, the terminal reconstruction has been started. Working on the construction of the railway, which will be owned incomes, and special passes for downloading gas. The terminal will be running already in 2007. In addition, a few months ago, SOCAR established SOCAR Georgia Company which will open the petrol stations on the Georgian territory and already bought the building in Tbilisi.
Far-reaching plans to SOCAR are to realize its own activity in Turkey. In early December R. Abdullayev and chairman of the Turkish oil company Turcas Erdal Aksoy signed a protocol to establish a joint company. The investment in the joint venture SOCAR Turcas Energy was defined at the level of 5 billion dollars. As President of SOCAR Rovnag Abdullayev said that the company intends to sell in the Turkish market oil and gas.
Azerbaijan, as being the owner of some oil, which comes from the export pipeline Baku-Tbilisi-Ceyhan in Turkey, may send it to the processing and further implement the oil on the Turkish market. At the same time, profit is not excluding that some products can be exported to other countries (Trend). Ministers prepared a plan of cooperation for world markets gas produced at the field Shah Deniz. Starting cost of the projects will be 1 billion U.S., the main goal is to rehabilitate over four years in the major Ceyhan refinery factory with an annual output of 20 million tons. 51% of the primary investment will belong to Azerbaijan, 49% of Turkey. At the facility also provides for the production of chemical products. It is noteworthy that as the building activity and its financial capability, the company will participate in the Projects and elsewhere, and it is possible that the field of the future activities of this company will be opened to Ukraine and the Republic of Moldova, as the allies of Azerbaijan on GUAM as well as countries in coastal state of the Black Sea, such as Romania and Bulgaria.
Rovshan Ibrahimov, email@example.com
This commentary is from USAK’s Energy Review Newsletter
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