Review of oil and gas operations in Azerbaijan (January-May 2010)

Analysis Materials 9 July 2010 11:04 (UTC +04:00)

1. FEC

а) Oil and gas 

In January-May, SOCAR's oil and gas department extracted about 22.17 million barrels of oil (3,038 million tons) at the offshore and onshore fields of the country compared to 22 million barrels (3,015 million tons) in January-May 2009, SOCAR said.

About 5.45 million barrels fall to the share of joint projects between SOCAR and foreign companies during this period. About 920.530 barrels fall to operating companies.

About 4,03 million barrels fall to the share of "Azeri-Chirag-Guneshli". Gas condensate from the field Shah Deniz hits 502.970 barrels.

In January-May SOCAR received about 3.24 billion cubic meters compared to 3.39 billion cubic meters during the same period last year.

SOCAR's oil and gas production departments extracted 2.98 million cubic meters of gas. Joint ventures and operating companies extracting gas onshore delivered SOCAR 28.7 million cubic meters of gas in January-May.

Azerbaijan International Operating Company (AIOC) extracted 1,4 billion cubic meters of associated gas in the field "Azeri-Chirag-Guneshli" for SOCAR in January-May compared to 1.74 billion cubic meters during the same period last year.

b) Refinery

In January-May 2010, Azerbaijan produced 2.07 million tons of oil products compared to about 1.85 at the same period of 2009, SOCAR, which owns two refineries, reported.

The bulk volume of production fell to diesel fuel -984,480 tons compared to 873,310 tons at the same period of 2009.

In January-May 2.6 million tons of oil were produced at two Baku refineries with capacity of 20 million tons of oil per year compared to about 2.5 million tons during the same period of 2009. Two refineries enter SOCAR annually processing 7 million tons of oil extracted onshore and offshore owing to own funds.

Aggregate table reflecting oil processing and oil products production in January-May 2010:

Oil products

January-May 2010- (thousands tons)

January-May 2009 (thousands tons)

Petrol - total



Auto petrol



- Straight-run petrol



Kerosen KO-20






Heating oil



Furnace oil



Petroleum bitumen



Petroleum coke






Liquefied gas



Motor fuel DT






c) Realization

The State Statistics Committee reported that approximately 1.4mln tons of oil products were sold to the internal market of Azerbaijan in January-May 2010, which is equal to the same period of 2009.  

Some 389,700 tons of the total volume of oil products was petrol, which is an increase of 5.6 percent than in the same period of 2009. The wholesale price for one ton of А-92 gasoline in the internal market (VAT and transportation costs inclusive) is 670 manats and А-95 - 736 manats. According to the State Statistics Committee, Azpetrol received over 190,100 tons of gasoline, SOCAR- 70,100 tons and LUKOIL - 60,800.

In January-May, 324,400 tons of diesel fuel was sold to the domestic market, which is by 14.3 percent more compared to the same period of 2009. The wholesale cost of 1 ton of diesel fuel (VAT and transportation costs inclusive) is 485 manats. Azpetrol received roughly 81,100 tons of diesel fuel, SOCAR Petroleum- 38,600 and LUKOIL - roughly 37,600 tons, the state statistics committee reported. The Azerbaijani State Caspian Sea Shipping Company received 9,000 tons of diesel fuel.

During the report period, 85,600 tons of fuel oil was sold to the domestic market, which is 51.6 percent less than the figure in the same period of 2009. The wholesale price of 1 ton of М-40 fuel oil in Azerbaijan is 100 manats (including delivery and VAT).

A total of 194,800 tons of aviation kerosene was sold in this period, 51.4 percent more than in the same period of 2009. The price of aviation kerosene is 307 manats per ton (including delivery and VAT).

The sale of petroleum bitumen totaled 69,300- tons, a decrease of 18.9 percent from the same period of 2009. The wholesale price of 1 ton of bitumen BN 60/90 (VAT and transportation costs inclusive) is 160 manats.

In January-May, some 30,200 tons of LPG was sold to the interior market, which is by 20.9 percent more than the figure in January-May2009.

The other more than 279,300 tons of oil products were also sold, less by 14.1 percent than in the same period of 2009.

2. Chemical complex

In January-May SOCAR's industrial enterprise Azerkimya (production of chemical products) produced 5.8 million cubic meters of nitrogen, or 21.3 percent more than the same period in 2009, the Azerbaijani State Statistics Committee said.

There was a significant increase in all the main types of chemical products produced by the company in January-May. Decrease was observed only in the production of sulfuric acid.

Production of basic chemical products during January-May:


January-May 2010

January-May 2009 (percent)

Nitrogen (million cubic meters)



polyethylene (thousand tons)


2,8 times

propylene (thousand tons)


2,2 times

isopropyl alcohol (thousand tons)


2,3 times

paintwork material (thousand tons)



sulphuric acid (thousand tons)



The increase in production of plastics and rubber is observed along with increased production of chemical raw materials in the country.

Thus, in January-May, about 2,400 tons of solid polyethylene pipes, tubes, hoses were produced in January-May.

This figure is 3,2 times more compared to same period of the last year. About 105 tons of porous polyurethane plates and strips, which is 19.2 percent less than the same period of the last year were produced. Growth is also observed in the production of plastic utensils. About 12,6 tons were produced in January-May, or 90.9 percent over the same period last year.

3. Electricity

In January-May Azerbaijan produced more than 8.1 billion kilowatt-hours of electricity compared to 8.4 billion kilowatt in the same period of 2009.

Over 6 billion kilowatt-hours of electric power fall on thermoelectric power stations and 1.7 billion kilowatt-hours - on hydro electric power stations of total volume of electric power generated in January-May.

Cross-flow of electric power was continued with neighboring countries, including Russia, Iran, Turkey and Georgia in May.