BAKU, Azerbaijan, January 10. Azerbaijan has hung negotiations with Turkmenistan to purchase gas via a swap arrangement and is developing the baseline version of the country's fuel and energy balance for 2024 without accounting for Turkmen gas, Trend reports via an informed source in the Azerbaijani government.
"The issue is overseen by the Minister of Economy of Azerbaijan, the head of the Supervisory Board of the State Oil Company of Azerbaijan (SOCAR) Mikayil Jabbarov. The current offer from the Turkmen side regarding the gas price does not satisfy Azerbaijan. We are inclined towards a price close to that of 2023 (around $140-150 per 1000 cubic meters)," the source said.
However, the insider did not rule out the prospect that the Turkmen side could subsequently submit a more palatable pricing proposition.
"Turkmenistan's counteroffer timeframes have yet to be determined. Therefore, Azerbaijan's fuel and energy balance, which is normally updated almost daily, will not reflect exchange supplies of Turkmen gas for the time being," the source noted.
According to the source, Azerbaijan can potentially do without gas from Turkmenistan in 2024.
"We'll definitely be able to cover both domestic demand and fulfill contractual obligations. Moreover, gas exports in 2024 may even exceed the 2023 figures," emphasized the source.
Moreover, the source mentioned an expected increase in gas production by one billion cubic meters at the Umid field (up to three billion cubic meters) and at the Caspian "Absheron" field (up to 1.5 billion cubic meters from 700 million cubic meters in 2023).
"Gas production at Shah Deniz will exceed 26 billion cubic meters. By the end of 2024, the commencement of deep-gas production at Azeri-Chirag-Gunashli is not ruled out. In other words, we'll fully cover obligations to consumers in Azerbaijan and importers," explained the source.
The Azerbaijani government forecasts gas production in the country to exceed 49 billion cubic meters in 2024, with nearly 37 billion cubic meters for all consumer categories (domestic and external), and the remaining gas will be injected into reservoirs to enhance oil recovery at ACG.