BAKU, Azerbaijan, May 11
By Nargiz Ismayilova - Trend:
A review of Azerbaijan’s oil and gas operations in first quarter of 2020 has been released, Trend reports referring to Azerbaijan's State Statistical Committee.
1. Fuel and energy complex
a) Oil and gas production
- Oil and gas condensate production amounted to almost 9.3 million tons from January through March 2020, which is 3.9 percent less compared to the same period of 2019, the report said.
Over the reporting period, the volume of gas production exceeded 9.9 billion cubic meters, while commercial gas production amounted to 6.9 billion cubic. On an annualized basis, these indicators increased by 10.1 percent and 15.3 percent, respectively.
As of April 1, 2020, the stock of finished oil products amounted to 377,200 tons.
The main volume of oil production falls on the Azeri-Chirag-Deepwater Gunashli (ACG) field.
- In the first quarter of 2020, the daily oil production in the country amounted to about 754,000 barrels.
- Presence of strong fiscal positions in Azerbaijan make the country one of the least vulnerable to oil shock, experts at the Moody’s international analytical agency said in their review on oil sector for March.
- The experts noted that the State Oil Company of Azerbaijan SOCAR sent the next batch of oil for Belarus in the amount of 85,000 tons from the Georgian port of Supsa in March, adding that the shipment of the following lots may be determined in the future.
- SOCAR and the Norwegian Equinor company confirmed the discovery of the Karabakh oil and gas field in the Azerbaijani sector of the Caspian Sea, 120 kilometers east of Baku. The drilling of the first appraisal well in the Karabakh field began on December 23, 2019. It was drilled by the Dede Gorgud semi-submersible floating drilling rig at a depth of 180 meters. Productive strata of the field are located at a depth of 3.4 kilometers. According to preliminary estimates, the volumes of oil and gas discovered in the field are enough for its cost-effective development.
- It is expected that the commercial operation of the Gas Interconnector Greece-Bulgaria (IGB), which will supply 1 billion cubic meters of gas per year from Azerbaijan to Bulgaria, will begin in the second quarter of 2021.
- The Black Sea Trade and Development Bank (BSTDB) transferred funds to SOCAR AQS LLC to purchase production equipment.
- The 3D seismic data collection program at the prospective block D230 in North Absheron in the Azerbaijani sector of the Caspian has been successfully completed.
b) Processing
- In 1Q2020, the total production of petroleum products in Azerbaijan amounted to 816 million manat ($480 million), which is 9.6 percent more compared to the first quarter of 2019, said the report.
Currently, due to the increase in fuel consumption in Azerbaijan, SOCAR, the country's only producer of petroleum products, is carrying out work on modernization of existing refining capacities.
The production of petroleum products increased 1.5 times over March.
Summary table of oil production of petroleum products in Azerbaijan:
|
Petroleum products |
Production volume for Jan.–Mar. 2020 (in tons) |
Difference compared to Jan.–Mar. 2019 (in percent) |
Finished products in warehouses as of April 1, 2020 (in tons) |
|
Car gasoline |
343,800 |
+13.5 |
82,200 |
|
Naphtha |
65,500 |
-16.9 |
- |
|
Kerosene |
146,600 |
-4.9 |
46,800 |
|
Diesel fuel |
559,900 |
+8.6 |
114,900 |
|
Fuel oil |
27,600 |
+53.3 |
12,100 |
|
Lubricating oils |
6,400 |
+30.6 |
11,800 |
|
Oil bitumen |
54,600 |
+38.6 |
19,700 |
|
Petroleum coke |
59,400 |
-2.9 |
65,700 |
- SOCAR intends to expand its business in Romania by leasing six filling stations through its subsidiary SOCAR Petroleum SA Romania owned by the Romanian ARAL MTB company. All gas stations of this company are located in places with heavy traffic.
2. Chemical complex
- From January through March 2020, over 2,456 tons of paint and varnish products were produced in Azerbaijan, which is 2.1 times less compared to the same period of 2019, said the report of the State Statistical Committee.
In the reporting period, 34,800 tons of propylene were produced in Azerbaijan, which is 18 percent more compared to the same period of 2019.
During the reporting period, 42,400 tons of ethylene were produced in the country.
Over March 2020, the production of most of the main types of chemical products increased in Azerbaijan.
Production of the main types of chemicals in Azerbaijan:
|
Name of products |
Production volume for Jan.-Mar. 2020 |
Percentage ratio compared to Jan.-Mar. 2019 (in percent) |
|
Nitrogen |
5.6 million cubic meters |
+1.1 |
|
Polyethylene |
24,000 tons |
-28.4 |
|
Propylene |
34,800 tons |
+18 |
|
Methanol (methyl alcohol) |
120,000 tons |
+89.4 |
|
Paint and varnish production |
2.4 million tons |
-51.4 |
|
Iodine |
43.6 tons |
-9 |
|
Oxygen |
552,700 cubic meters |
-30 |
|
Ethylene |
42,400 tons |
+16.5 |
- Due to the internal capabilities of Azerikimya PU, the existing old substation is being reconstructed. After the project is completed, the Azerikimya will have the opportunity to transfer electricity, provided at the expense of its own capabilities, to other SOCAR’s enterprises, as well as to consumers in Sumgayit city.
Both projects are planned to be completed in the 3rd quarter of 2020.
- It is scheduled to start overhaul work at the SOCAR Methanol Plant in July-August 2020. Overhaul is expected to last about a month and a half.
In 2019, SOCAR produced 383,000 tons of methanol. The plant’s capacity is 650,000-700,000 tons of products per year. This plant is the only methanol producer in the South Caucasus and Central Asia. It was commissioned in January 2014.
- The demand for alcohol has sharply risen in the markets due to the coronavirus pandemic. Given this trend, on the recommendation of the head of state at the Azerikimya PU’s Ethylene-Polyethylene plant, the production of isopropyl alcohol, which is the main raw material of disinfectants, was restored.
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