Baku, Azerbaijan, June 4
By Emil Ismayilov - Trend:
Azerbaijan needs to speed up the creation of new processing facilities, in order to meet the growing demand for fuel, the head of Azerbaijan's State Oil Company (SOCAR), Rovnag Abdullayev told reporters on June 4.
He stressed that the consumption of oil products in the country was expected to increase significantly by 2017, but as a result of a phenomenal economic growth in Azerbaijan, the volumes of gasoline production and consumption in the country became equal in 2013.
The primary oil processing capacity of the oil refineries operating in Azerbaijan is 10 million tonnes, while the maximum volume of deeper processing is equal to seven million tonnes with a depth of 93 percent.
"But after increasing the processing volume, it will be impossible to maintain this depth. And in order to meet the growing demand for light oil products, the modernization and renovation work will continue at the Baku Oil Refinery named after Heydar Aliyev," Abdullayev stressed.
He went on to add that it is necessary to speed up the process of creation of a new processing complex, adding that it is planned to commission the enterprises of this complex in stages by 2023.
The SOCAR head said that over 200 configuration options have been viewed in connection with the creation of a new oil and gas processing and petrochemical complex (OGPC), stressing that it is important to make a right choice.
OGPC will be located 60 kilometers from Baku and will consist of three processing enterprises and a thermal power plant (TPP).
The annual capacity of OGPC's refinery will be 8.5 million -9 million tonnes, gas processing plant - 12 billion cubic meters and the petrochemical production capacity will exceed one million tonnes (the capacity of the plant for the production of polyethylene will be equal to 800,000 tonnes, while the capacity of the polypropylene producing plant will be 300,000 tonnes).
The cost of the project for construction of the OGPC is estimated at $14.4 billion taking into account the interest payments on loans.
Some $6.1 billion of the total volume of project expenditures will fall to the oil refinery, $3.6 billion - gas processing plant and power generating unit, $2.6 billion - petrochemical complex and the remaining $2.1 billion will fall to the payments on loans.
It is planned to implement some 30-40 percent of the project with the equity, and the remaining part of the work will be carried out by using borrowed capital. The payback period of the project will last 4.5 years.
The first stage of the project will be implemented in two years, while the entire project will be completed in eight years.
Oil products are produced at two Baku oil refineries with a total capacity of 16 million tonnes of oil per year. Both oil refineries belong to SOCAR, which annually processes approximately seven million tonnes of oil, extracted from onshore and offshore fields with SOCAR's own funds.
Edited by C.N.