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Weekly review of Azerbaijan’s energy market

Oil&Gas Materials 9 April 2022 12:31 (UTC +04:00)
Weekly review of Azerbaijan’s energy market
Laman Zeynalova
Laman Zeynalova
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BAKU, Azerbaijan, April 9. The Asian Development Bank (ADB) proposed $35.7 million senior loan to Masdar Azerbaijan Energy for the construction and commissioning of Alat Solar Power Plant Project with an installed capacity of 230 MW. According to the bank, the project to build this power plant is part of ADB's strategy of actions against climate change, increase climate and disaster resilience, and environmental sustainability.

The Azerbaijani branch of “Petronas Azerbaijan (Shah Deniz) S.A.R.L.”, a subsidiary of Malaysia’s state-owned oil and gas company Petronas has announced its liquidation. Creditors can submit their claims within two months.

AVAX updated on progress in construction of Interconnector Greece-Bulgaria (IGB). IGB has reached 90-95 percent progress. It is expected that the project will end on time and will be able to supply gas in early July – as planned – from Greece to Bulgaria. IGB is in the final stage of hydraulic testing. The 130 km have already been hydraulically tested and within the next 15 days the next 50 km will have been completed. The metering station in Stara Zagora, which will connect the pipeline to the gas system in Bulgaria, is ready mechanically, electrically and now the construction work is finished.

EU revealed TAP’s share in total gas imports. The Trans Adriatic Pipeline ensured 3.2 percent of the total EU gas imports in the fourth quarter of 2021. TAP ensured around 33 TWh gas imports in the EU in the fourth quarter of 2021, up from 23 TWh in the previous quarter. The amount of gas imported to Europe via the Trans Adriatic Pipeline in the fourth quarter of 2021 stood at 3.4 billion euros.

There we quite intensive discussions about the operation of SOCAR’s carbamide plant. Brazil was the major export destination of carbamide produced by the carbamide plant of Azerbaijan’s state company SOCAR. Moreover, the plant exported around 32,000-35,000 tons of carbamide to Russia, Turkey and Romania each, and Italy, Bulgaria and Albania also were among the export markets. The plant’s monthly production stands at 60,000 tons. The carbamide plant doesn’t expect a high competition for its product. Growing carbamide production in the region [Turkmenistan already has a carbamide plant, while Kazakhstan and Uzbekistan are planning to have one] doesn’t have a negative impact. First, carbamide enjoys high demand at present. The sharp rise in prices for natural gas, which is the main raw material for carbamide production, has led to the closure of some European plants producing fertilizers. That’s to say, the supply volume decreases, while demand is growing continuously. Therefore, SOCAR doesn’t expect high competition. Second, Azerbaijan’s carbamide has its market share. It is not possible to increase production volume at the existing plant, since its production capacity is in accordance with the design and no modification will help boost these volumes. Construction of a new carbamide plant has been and is on the agenda. It depends on demand in world markets. Such a decision can be made in the future.

The ongoing projects to create energy infrastructure in Nakhchivan were named this week. Work continues on the construction of substations with a voltage of 132/110/35/10 kV and 35/10 kV in the Julfa district and Khanagha village of the Ordubad district. Besides, work is underway to install smart meters in Nakhchivan, Sharur and Babak cities. The construction of the Ordubad hydroelectric power station with an installed capacity of 36 MW and a hydroelectric power station with an installed capacity of 15.6 MW also continues in the Ordubad district. A solar power plant with an installed capacity of three MW is also being built in the Sharur district of the NAR.

The next coupon payment on SOCAR bonds will take place on May 1 this year. On this day, $1.125 million of interest income will be transferred to the accounts of bondholders.

SOCAR revealed Top 5 importers of STAR Refinery’s products. Top 5 importers of products of STAR Oil Refinery of Azerbaijan’s state oil company SOCAR in Turkey are Greece, Libya, Italy, Belgium and the Netherlands.

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