Baku, Azerbaijan, June 2
By Seymur Aliyev - Trend:
Azerbaijan's President Ilham Aliyev and his spouse Mehriban Aliyeva took part on June 2 in the opening of the 22nd international Caspian Oil and Gas Exhibition and Caspian Power 2015, the 5th Anniversary Caspian International Power and Alternative Energy Exhibition.
President Aliyev, welcoming the guests and congratulating the Azerbaijani people on the occasion of the opening of these exhibitions, said the Caspian Oil and Gas Exhibition plays a very important role in the country's life.
He said the holding of the first Caspian Oil and Gas Exhibition in 1994 was a very significant event, as at the time Azerbaijan was a very young independent state, and exactly after 1994, serious steps towards development began to be taken in the country.
The president, recalling that Azerbaijan's independence was restored in 1991, said that however, in 1991-1993, the situation was very hard and a political, economic and military crisis engulfed the country.
"The economy was paralyzed, there was a decline in industrial production, including the oil production," said Ilham Aliyev.
Referring to the 1994 exhibition, the president said that it presented Azerbaijan to the world and familiarized it with the country.
The president also expressed gratitude to the exhibition's organizers.
"I'd like to express my gratitude to the exhibition's organizers for that they have been for 22 years organizing it, demonstrating the world Azerbaijan's growing energy potential, and together with us, under partnership conditions, are working actively for Azerbaijan to develop even faster," he added.
The president recalled that the exhibition involves over 300 companies.
"This suggests that the interest in it doesn't reduce, despite that 22 years have passed since the first exhibition, and thus Azerbaijan continues to present its capabilities to the world," said the president.
"A new oil strategy of Azerbaijan was formed after holding the first exhibition in 1994," he added. "Initiated by the great leader Heydar Aliyev, the new oil strategy of Azerbaijan ensures today the successful development of the country."
Azerbaijan's president underscored that a historic agreement - the Contract of the Century - was inked in September 1994, helped to attract foreign investments to the country in large volume.
"If this historic step had not been taken in 1994, it would have been hard to imagine our country's development," said the president. "Those years, foreign investors believed in us, despite that Azerbaijan was known as a country with very high risks."
He went on to add that the foreign investments, the creation of good conditions for investors, as well as the protection of national interests of Azerbaijan as part of all the signed contracts were the main conditions for a successful cooperation.
"The interests of both the investors and the state, the Azerbaijani people, coincided, and exactly the spirit of this excellent cooperation today ensures Azerbaijan's successful development, and not only in the oil and gas sector, but also in all other areas," said President Aliyev.
"I can say the experience we have gathered with foreign partners in the oil and gas sector, gives us an opportunity to attract investments in other areas as well, to successfully cooperate with foreign companies and ensure the diversified development of the country," said the president.
The Contract of the Century was the contract of the 20th century, said the president.
"Today, we are already implementing the contract of the 21st century. The Southern Gas Corridor is the contract of the 21st century and namely the contract signed in 1994 and the success achieved following it made today's reality possible."
President Aliyev recalled a contract signed in 1996 with the international consortium on Shah Deniz gas field.
"Back then, the gas factor didn't have such great importance in the global oil and gas sector and the countries' energy security wasn't directly related to gas reserves."
The head of state noted that Shah Deniz gas field is one of the largest fields in the world and its development today provides the main resource base for the Southern Gas Corridor.
Baku-Tbilisi-Ceyhan, Baku-Tbilisi-Erzurum and Baku-Supsa pipelines were built before that, said the president.
"Thereby, for the first time in the history, the Caspian Sea was linked with the Black and Mediterranean seas via a branched pipeline network and this was a historic event. Caspian, Black Sea and Mediterranean Sea cooperation was formed."
"It became apparent in other spheres as well and namely, Baku-Tbilisi-Kars railway, which is the large infrastructure project, is today being implemented via this route."
"This, too, would be impossible if we have incorrectly built out energy policy," said the president. "Thus, the work done in late 90's, and the Baku-Tbilisi-Ceyhan, Baku-Tbilisi-Erzurum pipelines in early 2000's, were of course, a great historic achievement."
"This allowed Azerbaijan to get large currency reserves, and using them effectively, we have aimed our currency reserves at the main directions of the country' development," said the president.
President Aliyev said that the people's well-being has improved, and the country's economic development has been ensured.
"Over the past ten years, Azerbaijan's economy has been growing at the fastest pace on the world scale, and it has grown by 300 percent," President Aliyev added.
He also noted that at the same time, the infrastructure projects facing the country have been implemented and the social issues have been settled.
"Pursuing a thought-out economic policy, we managed to cut dependence on oil to a large extent, today the oil factor in GDP is only 30 percent, and thus we have made great success in diversifying the country's economy," said the president of Azerbaijan.
The head of state said that undoubtedly, large investments made in the country in 1990s and 2000s are at the core of all of this.
"Thus, in the economic sphere, we are less dependent on the oil factor," said the president. "Therefore, although the oil prices almost halved, our economy grew by over 5 percent in 2014. That's to say, the diversified development of our country, sustainability of our economy is already a reality and our important tasks of course are not related to the oil and gas sector."
President Aliyev added that the main tasks are diversification of the economy, further decreasing dependence on the oil sector, improvement of Azerbaijani people's welfare, implementation of major infrastructure projects that haven't been realized for the present and thereby create even stronger basis for the long-term development.
Aside from that the country's serious tasks in the energy sector will undoubtedly be fulfilled, according to the president.
"Because there are great reasons for this. I'd like to once again say the international cooperation in the oil and gas sector today shows that Azerbaijan's cooperation with foreign partners is based upon a very healthy soil," said the president.
"Here, I'd like to especially note the relations of SOCAR and BP," he said. "BP is our main partner that has made largest investments, and the leading foreign investor and a partner both in the realization of the Contract of the Century and in the Shah Deniz project."
As the president said, the cooperation between SOCAR and BP continues as part of other projects as well, this cooperation has over 20 year history, and will further continue for decades.
"This brings benefit both to our state and foreign partners. Such an excellent climate has been created in Azerbaijan. All the foreign investments are protected adequately," he said.
"As is known, all the oil and gas contracts have legal force and are approved by the parliament, and this certainly increases the investors' trust in us," President Aliyev said.
In his speech, President Aliyev said that while reviewing the past, today one can say with pride that Azerbaijan adequately and timely fulfilled all challenges in the energy sector.
"The Baku-Tbilisi-Ceyhan, the Baku-Tbilisi-Erzurum pipelines, the development of Shah Deniz gas field and Azeri-Chirag-Guneshli oil fields, each of these projects is a giant energy project," the president said. "At the same time, the process of implementing the South Gas Corridor started. This is also a historic event."
"I should stress that while implementing this project, Azerbaijan has once again demonstrated its role and leadership qualities," he said.
"As it is known, the Caspian Basin gas supply route to Europe has been discussed for many years. Azerbaijan took part in these discussions. But when we have seen that these discussions do not lead to concrete results, we have put forward our own initiatives. And Azerbaijan and Turkey signed an agreement on TANAP gas pipeline construction in 2012."
"Afterwards, these processes passed faster," the president said. "The Trans Adriatic Gas Pipeline was chosen as the main export route to Europe. The Southern Gas Corridor implementation started. The Shah Deniz 2 project started. We have reached all these achievements for the past three years."
"I remember that while speaking at the exhibition in 2014 - precisely a year ago, I expressed confidence that we will report to the people about the new achievements at the next exhibition," he said. "This is true. The foundation of the Southern Gas Corridor was laid during the period that had passed since the last 21st exhibition."
"This happened in a solemn ceremony at the Sanchagal terminal in Baku on September 20, the day when the "Contract of the Century" was signed," he said. "This was symbolic. Afterwards, the first meeting of the Advisory Board of Southern Gas Corridor was held in Baku."
"The senior officials of all countries, involved in the Southern Gas Corridor, as well as vice-president of the European Commission and other officials attended this event," he said. "We launched the TANAP project in the Turkish city of Kars in March."
"Look, all these events have occurred for the last year - during the period that has passed since the last exhibition," he said. "Southern Gas Corridor" has already become a reality. The project is being implemented.The expansion of the South Caucasus Gas Pipeline actually means construction of a new pipeline. The TANAP project will be implemented in due time - in three years. Thus, Azerbaijan will be able to transport gas from the Shah Deniz-2 to both Georgia and Turkey."
The president expressed hope that there will be no problems with the TAP project implementation.
"I think that all sides must show great responsibility because it is our common cause," the president said. "The discussions of the Advisory Board of the Southern Gas Corridor held in Baku in February 2015, on the initiative of Azerbaijan and the statement made for the press shows that all involved sides are aware of their responsibility."
Azerbaijan's leading role, that's to say, the country's special role was noted in that statement, said President Aliyev. "Therefore, I believe that there is a great need for coordination in the implementation of this project. I stressed this during the meeting of the Advisory Board as well."
Azerbaijani president added that for the implementation of the Southern Gas Corridor project, mutual trust should necessarily be at a high level. He said all the participating countries should focus on one and the same goal, and no one should ask for additional privileges.
"Everything is obvious here. All contracts have been signed. All the sides, companies, countries participating in this global project will benefit greatly," said the president.
"Naturally, currently, we are starting a new form of cooperation," he said. "Previously, there was created a trilateral format, Azerbaijan-Georgia-Turkey format that was working with great effectiveness. Three brotherly countries were implementing all the projects with close cooperation."
Now the format is expanding, the new players are joining it, he said, adding that Azerbaijan, Georgia, Turkey, Greece, Bulgaria, Albania, Italy are the members of the Southern Gas Corridor.
Azerbaijani president said that meanwhile, a memorandum was signed with some Balkan states on their participation in the Southern Gas Corridor project.
President Aliyev said that on one hand, it is a great advantage, but on the other hand, undoubtedly, some issues can emerge in certain stages. All these issues should be discussed and resolved under the conditions of friendship, brotherhood and mutual understanding, he added.
"I would like to reiterate that there shouldn't be artificial barriers for us and I'm confident that there won't be any," said the president. 'In this case, we will also implement the TAP project on time."
Thereby, the transportation of Azerbaijani gas to Europe will begin, said Aliyev.
"This will also be a historic event both for us, since we will get an opportunity to enter big gas markets and for European consumers, because they will receive great volume of gas with growing rates from the alternative source."
"The Southern Gas Corridor's advantage is that here the matter rests in a new source of gas," said President Aliyev.
He stressed that the diversification of routes is an important issue, adding that each country aspires to have a branched pipeline network. The president said that this is also true for Azerbaijan, as today the country has seven oil and gas pipelines.
"Thus, we don't depend for 100 percent on any direction," he said. "Naturally, consumers also want that the energy resources supplied to them go via various ways."
Therefore, as the president added, the diversification of routes, of course, strengthens energy security.
"But if there is no diversification of the source, this has no significance. Our advantage is that the gas will be transported to Europe via a new route, and at the same time, that gas will be received from a new source," he said.
That source is very large, according to the president. He said the Shah Deniz gas field with reserves of 1.2 trillion cubic meters is currently the sole resource base of the Southern Gas Corridor.
"Today, Azerbaijan's proven gas reserves stand at 2.6 trillion cubic meters, and I am sure that this is not the final figure. It will grow, because at the moment evaluation is underway at many fields," he said.
President Aliyev said explorations are going on at some fields, expressing confidence that Azerbaijan's gas resources and proven reserves will be even bigger.
"Therefore, when we are talking about energy security, of course, the matter rests in diversification of routes and sources. Here Azerbaijan has quite a unique role," he said.
"Back in 2011, Azerbaijan and the European Union signed a memorandum on strategic partnership in the energy sector. The recent processes in the energy policy of the European Union confirmed the recognition of Azerbaijan as a very important partner," President Aliyev said.
Azerbaijan's president said that Azerbaijan today is well aware of its role and its responsibility, and the country shows itself as a reliable partner.
The president said the work to be conducted in the future in the energy sector will raise the relations between Azerbaijan and the EU to a higher level.
"Our intention is to examine the format of strategic partnership, and then each side will be able to determine the long-term strategy," the president said. "And, of course, all the issues can be settled via serious coordination."
"The rich oil and gas resources of Azerbaijan, bold policy and thought-out steps are changing Europe's energy map. This is a reality. Our role will continue to grow," President Aliyev added.
He further said that this will strengthen Azerbaijan even more and will bring the political and economic dividends to the country.
"As a result, this will provide even more opportunities to improve the life of the Azerbaijani people. At the same time, as I have said, we are carrying out reforms in the economic sphere," said the president.
He added that the reforms carried out in Azerbaijan are highly assessed by the world's leading financial institutions.
All the economic indexes are at the highest level, the president said. He added that Azerbaijan ranks 38th for the economic competitiveness, according to the estimates of the World Davos Forum, the country's foreign debt is only 10 percent, while the unemployment rate is 5 percent.
"The strategic currency reserve account for 75 percent of GDP and perhaps even more," said the president.
Despite the sharp decline of oil prices, Azerbaijan ensures its economic development, he said, adding that in the first four months of 2015, the economy has grown by 5.3 percent and the non-oil sector has increased by approximately 7 percent.
Furthermore, the president said that Azerbaijan also holds major, prestigious international events.
"After ten days, the First European Games will be held namely in Azerbaijan, in Baku for the first time in the history," said Ilham Aliyev, adding that it is a historic event.
"We have prepared for these Games only in two years, he said. "In a short time, we organized the Games to be held at the level of Olympic Games."
"It shows our country's power, our strong political will," said the president. It shows that although Azerbaijan is a newly independent country, it succeeded to have its place on the world map and it is a solid place, according to President Aliyev.