Baku, Azerbaijan, Dec.28
By Emil Ismayilov - Trend:
Baku-Tbilisi-Ceyhan oil pipeline
The BTC transports most of the oil produced in Azerbaijan that is Azeri Light oil, produced at the offshore fields of Azeri-Chirag-Guneshli.
The total length of the BТС is 1,768 kilometers, including the 443 kilometers section running through Azerbaijan, the 249 kilometers section through Georgia and the 1,076 kilometers through Turkey. The capacity of the pipeline is 1.2 million barrels per day. BTC's construction cost $4 billion.
BP is the operator of the oil pipeline. In early September, the U.S. oil company Hess agreed to sell its share to India's ONGC (2.72 percent) in the project for developing the ACG oil fields, as well as a 2.36 percent stake in the BTC pipeline. The deal value is estimated at $1 billion.
Hess Corporation said in March 2013 that it had completed the deal on selling its shares in the project in Azerbaijan to ONGC. The net profit from the deal amounted to $884 million after taxes.
The shareholders of BTC Co. are BP (30.1 percent), AzBTC (25 percent), Chevron (8.9 percent), Statoil (8.71 percent), TPAO (6.53 percent), Eni (5 percent), Total (5 percent), Itochu (3.40 percent), Inpex (2.5 percent), ConocoPhilips (2.50 percent) and ONGC (2.36 percent).
Project status
According to the State Statistics Committee, in January.-November 2013 the transportation via Baku-Tbilisi-Ceyhan hit 30.1 million tons of oil, this equaled the amount of this period in 2012.
Around 2.8 million tons of Turkmen oil was transported via the BTC in January-November 2013 compared to 2.9 million tons in the same period of 2012. Most of the oil extracted in Azerbaijan is being exported via the BTC.
Around 3.1 million tons of Turkmen oil was transported via the BTC in 2012 compared to 2.1 million tons in 2011.
Turkmen oil is being transported via the BTC within SOCAR Trading's contract with Dragon Oil, extracting oil in Turkmenistan. Turkmen oil transportation via the BTC began in July 2010.
The transportation of Kazakh oil via the BTC was resumed in August 2013. Some 243,680 tons of Kazakh oil was transported via the pipeline only in November.
Baku-Supsa oil pipeline
The length of Baku-Supsa is 827 kilometers and its diameter is 530 millimeters. The capacity of the pipeline is over 6 million tons per year. The pipeline transfers Azeri Light, extracted from the Azeri-Chirag-Guneshli offshore block headed by BP. Azerbaijan International Operating Company (AIOC) is the operator of the Baku-Supsa pipeline.
Project status
According to BP, in January-September the Baku-Supsa pipeline transported 22.1 million barrels of oil compared to 22 million barrels in the same period of 2012.
SOCAR exported 2.48 million tons from the Georgian port of Supsa in January-November compared to 2.58 million tons in January-November 2012.
Oil is being delivered to Supsa via the Baku-Supsa oil pipeline.
Baku-Novorossiysk pipeline
SOCAR's oil is mainly transported via the Baku-Novorossiysk pipeline. It is extracted in the onshore and offshore fields by the company with its own funds. Joint enterprises and operational companies with foreign companies extract from the onshore fields.
The Azerbaijan International Operating Company is headed by BP. The total length of the Baku- Novorossiysk pipeline composes 1,147 kilometers. The length of the pipeline in the territory of Azerbaijan is 231 km, in the territory of Russia - 916 km, and the diameter is 720 millimeters. The pumping capacity is 120,000 tons per day.
Project status
In January-November 2013, SOCAR transported 1.58 million tons of oil via Baku-Novorossiysk pipeline compared to over 1.83 million tons in the same period of 2012.
SOCAR exported 2.06 million tons of oil in 2012 compared to about 1.99 million tons in 2011.
SOCAR transports oil extracted at its own fields, as well as that of joint ventures and operating companies working onshore in Azerbaijan through Novorossiysk.
However, Russian Prime Minister Dmitry Medvedev signed a decree with Azerbaijan in May to terminate the agreement on transit of Azerbaijani oil via the Baku -Novorossiysk pipeline.
So far, the Azerbaijani and Russian sides have not yet found a mutually acceptable solution to the oil pipeline, but the negotiations are underway.
If the parties fail to agree, then pumping of Azerbaijani oil through the oil pipeline may stop in February 2014 in accordance with the inter-state agreement.
The pipeline operation in the opposite direction (the transportation of oil from Russia to Azerbaijan) is considered as a variant of the continued operation. This will redirect some Russian oil for refining in Azerbaijan, while transporting the rest via the Baku-Tbilisi- Ceyhan oil pipeline to the Mediterranean coast.
If the parties fail to agree, oil currently transported via the Baku -Novorossiysk pipeline, will be pumped through an alternative pipeline routes, particularly via the BTC.
Baku-Tbilisi-Erzurum gas pipeline (South Caucasian gas pipeline)
The length of the Baku-Tbilisi-Erzurum (South Caucasian gas pipeline) is more than 700 km. The gas produced from the Shah Deniz field in the Azerbaijani sector of the Caspian Sea is transported via this pipeline. The gas is supplied to Georgia and Turkey.
Azerbaijan also acts as the buyer of this gas.
Shah Deniz Stage 2 will provide an extension of the South Caucasus gas pipeline.
On Dec. 17 it was announced in Baku that Norwegian Statoil sold its share in the South Caucasian gas pipeline to SOCAR and BP. SOCAR acquired 6.7 percent and BP acquired 3.3 percent of Statoil's share in the Baku-Tbilisi-Erzurum gas pipeline and the Shah Deniz field's development project.
The sale of Statoil's assets in Azerbaijan amounted to $1.45 billion. The deal will come into force on Jan.1, 2014.
The South Caucasus gas pipeline participants include: BP (operator) - 28.8 percent, Statoil - 15.5 percent, NICO - 10 percent, Total - 10 percent, Lukoil - 10 percent, TPAO - 9 percent, SOCAR - 16.7 percent (new share distribution after the sale and purchase transactions).
Project status
Between January and November 2013 the South Caucasian pipeline (Baku-Tbilisi-Erzurum) transported 4.3 billion cubic meters of gas compared to 3.6 billion cubic meters of gas in the same period of 2012, according to the State Statistics Committee of Azerbaijan.
In 2012, the South Caucasian gas pipeline (Baku-Tbilisi-Erzurum) transported four billion cubic meters of gas compared to 4.5 billion cubic meters of gas in 2011.
Currently, part of gas from the total daily gas volume is supplied to Turkey, Georgia and to pumping plants of the Baku-Tbilisi-Ceyhan pipeline. The rest is transferred to Azerbaijan from the Sangachal terminal of BP.
Azerbaijan-Georgia pipeline
SOCAR supplies its own gas to Georgia via a pipeline linking the two countries in the Gazakh district of Azerbaijan. The pipeline's capacity is more than 2.5 billion cubic meters of gas per year.
In November 2008, Azerbaijan and Georgia signed an agreement that made it possible to intensify SOCAR's activity in the Georgian gas market over a five year period, starting from 2009. According to the memorandum, SOCAR established a subsidiary enterprise - SOCAR Georgia Gas, in order to implement the project. SOCAR Georgia Gas provides gas for consumer groups defined by the Georgian government.
On Dec. 26, 2008, SOCAR and Georgia signed an agreement to transfer the control of 30 gas distributing enterprises and the distribution of gas networks. The list of gas distribution facilities was increased. All these facilities were earlier liquidated. Seven regional gas facilities managed by SOCAR were formed in their place.
SOCAR will continue gasification of Georgia's regions, providing an additional 100,000 households until 2017. The gasification process will be continued as part of the cooperation memorandum signed on Dec. 24. The memorandum was signed by SOCAR head, Rovnag Abdullayev and Georgian Economy and Sustainable Development Minister, Giorgi Kvirikashvili and Energy and Natural Resources Minister, Kakha Kaladze.
Project status
SOCAR gas exported to Georgia will hit 1 billion cubic meters by late 2013. The export volume of gas to Georgia amounted to 993 million cubic meters in 2012 compared to 775 million cubic meters in 2011.
In the first half of 2013, SOCAR exported 446 million cubic meters of gas to Georgia.
Azerbaijan-Iran pipeline
Azerbaijan and Iran are connected by the 1,474.5 km Astara-Bind-Biand gas pipeline with 296.5 kilometers in the territory of Azerbaijan. Its design capacity was 10 billion cubic meters a year, now it is lower. This route is a branch of the Gazakh-Astara-Iran pipeline commissioned in 1971. Three compressor stations, Gazi-Magomed, Aghdash and Gazakh were built on its route. The transmission system is designed for atmospheric pressure of 55. The pipe's diameter is 1,200 mm.
Project status
At present, the pipeline supplies about 1.2 million cubic meters of gas, transported through Iran, to meet the needs of the Nakhchivan Autonomous Republic of Azerbaijan.
According to the contract signed with Iran, 400 million cubic meters of gas are annually exported from Azerbaijan to this country, of which 300 million cubic meters are supplied to Nakhchivan Autonomous Republic for its needs. In the first half of 2013, SOCAR delivered 217 million cubic meters of gas to Iran. In turn, according to the terms of the contract, Iran supplied 179 million cubic meters of gas to the Nakhchivan Autonomous Republic.
Commercial supply of Azerbaijani gas is not available. But Iran has repeatedly stated its intention to purchase about five billion cubic meters of gas per year from Azerbaijan.
Azerbaijan-Russia gas pipeline
The Mozdok-Kazi-Magomed Pipeline has a capacity of 5 billion cubic meters of gas per year. Until 2007, Azerbaijan imported up to 4.5 billion cubic meters of gas from Russia through the pipeline. In 2008, Azerbaijan refused to import gas and in January 2010 started exporting fuel via the Mozdok-Kazi-Magomed gas pipeline, according to a contract between SOCAR and Gazprom.
Project status
The contract (with a possibility of extension) for purchase and sale of Azerbaijani gas was signed between SOCAR and Gazprom in Baku on Oct.14, 2009. According to the supplement to the contract which was signed in early September 2010 in Baku, in 2011, Gazprom was to receive two billion cubic meters, and in 2012 over two billion cubic meters of gas.
The additional agreement to double the volume of gas purchased by Russia from 1.5 to 3 billion cubic meters was signed by the parties in Sochi on Jan. 24, 2012. Azerbaijani gas supplies to Russia began in January 2010.
As of the first half of 2013, SOCAR exported 876 million cubic meters of gas to Russia.
Translated by L.Z., N.H., E.A., M.L.
Edited by C.N.