Review of oil and gas operations in Azerbaijan (January-February 2016)

1. FEC

а) Oil and Gas Production

Azerbaijan produced 6.87 million tons of oil and gas condensate in Jan.-Feb. 2016, which is 1.4 percent less than in the same period of 2015, said the country's State Statistics Committee's report on Jan.-Feb. 2016.

The country produced 41.69 million tons of oil and gas condensate in 2015 versus 41.9 million tons of oil in 2014.

The main volume of oil production accounted for the Azeri-Chirag-Guneshli (ACG) block of oil and gas fields.

Azerbaijan produced 3.15 billion cubic meters of marketable gas in Jan.-Feb. 2016, which is 8.3 percent less than the same period of 2015, according to the report.

In 2015, Azerbaijan produced 19.72 billion cubic meters of marketable gas versus 18.7 billion cubic meters of gas in 2014.

The State Oil Company of Azerbaijan (SOCAR) produced 1.25 million tons of oil at the country's offshore and onshore fields in Jan.-Feb. 2016 versus 1.35 million tons of oil produced in the same period of 2015.

SOCAR produced 1.05 billion cubic meters (bcm) of gas in Jan.-Feb. 2016 from the country's offshore and onshore fields using its own funds, compared to 1.09 bcm produced in Jan.-Feb. 2015.

SOCAR carried out drilling operations in the volume of 16,850 meters in Jan.-Feb. 2016 versus 14,160 meters during the same period of 2015, SOCAR's message said.

All volume of drilling operations in Jan.-Feb. accounted for production drilling.

Five new wells were commissioned during the reporting period.

The volume of investments made in Azerbaijan's oil and gas sector stood at 1.39 billion manats in January-February 2016, or 55.7 percent more than in the same period in 2015, said the report.

b) Processing

Azerbaijan produced 944,300 tons of oil products in January-February 2016, compared to 829,800 tons in the same period of 2015, said the report.

Currently, SOCAR is modernizing its processing facilities, as the fuel consumption has increased in the country.

During the reporting period, Azerbaijan produced 179,600 tons of motor gasoline, or 9.9 percent less than in January-February 2015.

Below is the summary table of oil products' output in Azerbaijan:

SOCAR and Italian KT-Kinetics Technology SpA signed a contract on licensing the construction of a sulphur production facility as part of modernization of the Heydar Aliyev Baku Oil Refinery. Earlier, SOCAR signed contracts with Austrian Pörner Group, French company Axens and US UOP as part of the project.

2. Chemical complex

Azerbaijan produced 17,800 tons of polyethylene in January-February 2016, which is 7.8 percent more than in the same period of 2015, the report said.

The country produced 8,300 tons of propylene in January-February 2016, or 5.4 percent less than in the same period of 2015.

Some 10,200 tons of barium sulfate were produced in Azerbaijan during the reporting period, which is 18.9 percent more than in the same period of 2015.

Around 3,040 tons of isopropyl alcohol were produced in the country in January-February, which is 2.4 times more than in the same period of 2015, the report said.

However, Azerbaijan saw an increase in the production of other major types of chemical products in January-February 2016.

The table below shows the production volume of major types of chemical products:

The country produced 0,770 tons of solid polyethylene pipes, tubes and hoses, which is 63.9 percent less than in the same period of 2015.

3. Electricity

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Azerbaijan's power plants generated 4.01 billion kilowatt hours of electricity in January-February 2016, or 6.4 percent less than in the same period of 2015, said the report.

Commercial electricity accounted for 3.83 billion kilowatt hours of the total volume of electricity produced during the reporting period, or 6.4 percent less than in January-February 2015.

Thermal power plants accounted for 3.63 billion kilowatt hours of commercial electricity produced in January-February 2016, or 7.9 percent less than in the same period in 2015.

This is while Azerbaijan's hydro power plants generated 195.1 million kilowatt hours of commercial electricity in January-February 2016, or 33.6 percent more than in the same period in 2015.

During the reporting period, the country's wind farms and solar power plants generated 2 million and 0.7 million kilowatt hours of electricity, respectively.

Azerenergy JSC is the main producer of electricity in Azerbaijan. It has over 200 substations with a capacity of 500, 330, 220 and 110 kilovolt amperes, as well as 10 hydro power plants and 14 thermal power plants.

At present, the generation capacity of Azerbaijan's power supply system is 7,200 megawatts. This allows generating around 24 billion kilowatt hours of electricity annually.