SOCAR suspends exporting its oil products through Russia
Azerbaijan's state oil company SOCAR has suspended exporting its oil products through Russia, a source in Azerbaijan's energy market told Trend March 6.
"SOCAR has stopped supplying oil products manufactured at the Heydar Aliyev Baku Oil Refinery through Russia and uses its Kulevi Oil Terminal in Georgia for export in this direction," the source said. "The terminal has sufficient capacity for the Azerbaijani oil products to reach the Black Sea."
The source added that presently, SOCAR also uses its traditional standard routes for delivering oil products to Central Asia.
SOCAR exported diesel fuel and vacuum gas oil through Russia in 2015 and 2016.
In January 2018, SOCAR signed a deal with the Vienna-based Cetracore Energy oil trading company and its shareholder, Russia's Rosneft oil company and started to export Russian oil products from the Black Sea port of Tuapse city.
Azerbaijan’s contractors may take part in Kazakhstan’s oil projects
Oil contractors of Azerbaijan may take part in joint ventures on development of Kazakhstan's Kashagan field, a source in the Energy Ministry of Kazakhstan told Trend.
"The development of local (Kazakh) content in goods and services, used in several projects in Kashagan oil field is of particular importance, and the creation of Joint Ventures/Consortiums (JVs) between foreign and Kazakh companies also contributes to this development. In this regard, we do not exclude the participation of contractors from Azerbaijan in the mentioned projects, both as potential suppliers and JV members, in case of availability of competitiveness," the source said.
North Caspian Operating Company (NCOC) approved tender procedures according to which any suppliers have the opportunity to apply online for the pre-qualification and further participation in the operations of Kashagan oil field.
Touching upon the work, carried out on the transit of Kazakhstan's energy resources through Azerbaijan, the source added that Azerbaijan and Kazakhstan formed a Working Group on transit of Kazakh oil and oil products through Azerbaijan in accordance with the Protocol of the 14th meeting of the Kazakh-Azerbaijani Intergovernmental Commission on Trade, Economic and Cultural Cooperation, held on December 7, 2017.
Presently, the both sides consider the place and date of the first meeting of the above-mentioned working group, Trend was told.
SOCAR to launch new project to gather associated gas in onshore field
Azerbaijan's state oil company SOCAR will launch operations to gather and process associated gas at Zagli-Zeyva field in April to reduce carbon emissions, SOCAR vice-president for ecology Rafiga Huseynzade said.
Huseynzade made the remarks at the conference following the signing of a protocol of intentions between SOCAR and United Nations Development Program (UNDP) in Baku March 6.
She added that the Nationally Appropriate Mitigation Actions (NAMA) project, being implemented by SOCAR and UNDP, supports the technologies that help to save energy and reduce carbon emissions.
"Six wind turbines and solar panels with a capacity of 63 kilowatts have already been installed within the project," she said. "The training that will cover about 1,000 employees will be held this year."
"The work has been outlined to gather, process and transfer associated gas from 63 wells at Zagli-Zeyva field, which is being developed by 'Siyazan Oil' Oil and Gas Management," she said. "Within the project 6.8 million cubic meters of associated gas are planned to be gathered during the year."
Germany to provide loan guarantee for Azerbaijani gas supply to Europe
German government intends to provide loan guarantee of $1.5 billion to Azerbaijani state-owned enterprise through a German bank for ensuring gas supply from Azerbaijan, DW reported.
The report refers to the letter from the Parliamentary State Secretary at the Ministry of Finance of Germany, Jens Spahn, to the chairman of the budget committee of the Bundestag, Peter Boehringer.
The letter says that the loan will amount to $1.5 billion dollars (1.2 billion euros).
"These gas supplies should make a significant contribution to providing Europe and Germany with gas," said the letter.
Since January 1, 2016, German Uniper had a spin-off with German E.ON company which was one of the nine European companies that signed an agreement with Shah Deniz consortium in September 2013 on purchasing Azerbaijani gas.
The gas trading business is now in the responsibility of Uniper.
The Shah Deniz consortium announced on September 19, 2013 that 25-year sales agreements have been concluded for just over 10 billion cubic meters a year of gas to be produced from the Shah Deniz field in Azerbaijan as a result of the development of Stage 2 of the Shah Deniz project.
The contracts on the purchase of Azerbaijani gas from the second phase of Shah Deniz field development (Shah Deniz-2 project) were signed with Shell, Bulgar gas, Gas Natural Fenosa, EON, Gaz de France, Hera, Enel, Axpo, DEPA.
The Shah Deniz Stage 2 project is set to bring gas directly from Azerbaijan to Europe for the first time, opening up the Southern Gas Corridor.
In total 16 billion cubic meters a year of Shah Deniz Stage 2 gas will be delivered through more than 3500 kilometers of pipelines through Azerbaijan, Georgia, Turkey, Greece, Bulgaria, Albania and under the Adriatic Sea to Italy.
The Southern Gas Corridor, worth over $40 billion, is considered as one of the priority energy projects for the EU, which strives for diversification of gas sources. The project envisages the transportation of gas from the Caspian region to the European countries through Georgia and Turkey.
At an initial stage, the gas to be produced in the Stage 2 of development of Azerbaijan's Shah Deniz field is considered as the main source for the Southern Gas Corridor projects. Other sources can also connect to this project at a later stage.
As part of the Shah Deniz Stage 2, the gas will be exported to Turkey and European markets by expanding the South Caucasus Pipeline and the construction of Trans-Anatolian Natural Gas Pipeline (TANAP) and Trans Adriatic Pipeline (TAP).
TAP expands opportunities for large European markets
In line with EU regulation, any shipper who wishes to take part in open seasons of the Trans Adriatic Pipeline (TAP) may do so as long as they comply with the requirements for participation, Lisa Givert, TAP Head of Communications, told Trend and Azernews commenting on the possibility of other countries joining the project.
Earlier, European Commission Vice-President for Energy Union Maros Sefcovic said that the EU is ready to discuss the possibility of connecting Iran to the Southern Gas Corridor. He also said that the EU continues to seek ways to connect Turkmenistan to the Southern Gas Corridor project at a press conference in Baku on February 15 following the Fourth Ministerial Meeting of the Southern Gas Corridor Advisory Council.
"TAP is the European leg of the Southern Gas Corridor, which is one of the most complex energy projects worldwide. While TAP will initially transport 10bcm/a from the Shah Deniz II field in Azerbaijan, our pipeline can double its capacity once additional gas resources come on stream," Givert said.
TAP's landfall in Italy provides multiple opportunities to some of the largest European markets such as Germany, France, the UK, Switzerland and Austria, according to TAP head of communications.
"TAP's contribution to energy security and diversification will perhaps be most significant in South Eastern Europe. TAP remains committed to facilitating connections to several infrastructure projects such as the Interconnector Greece - Bulgaria (IGB) and the Ionian Adriatic Pipeline (IAP)," she noted.
Givert stressed that by cooperating with IGB and IAP, TAP plays a key role in facilitating greater interconnectivity and security of supply - key objectives of the European Energy Union.
"TAP also has reverse flow capability in the event of an emergency or potential cut off further upstream. We do want to emphasize that TAP neither owns the gas it transports, nor is it responsible for building physical infrastructure in South-Eastern Europe (beyond our 878km pipeline)," she said.
So, it is up to the various entities in the region to arrange commercial terms with potential suppliers of gas to ensure new and diversified sources reach their respective markets, according to Givert.
"As economic recovery continues, and coal-fired power generation is gradually phased out, it is expected that natural gas demand in South-Eastern Europe will grow, to power homes and industries," she stressed.
So, TAP will enable the introduction of a cleaner energy source, therefore contributing to reducing carbon emissions and achieving environmental targets, according to Givert.
TAP project, worth 4.5 billion euros, is one of the priority energy projects for the European Union (EU). The project envisages transportation of gas from Azerbaijan's Shah Deniz Stage 2 to the EU countries.
Connecting with the Trans Anatolian Pipeline (TANAP) at the Greek-Turkish border, TAP will cross Northern Greece, Albania and the Adriatic Sea before coming ashore in Southern Italy to connect to the Italian natural gas network.
The project is currently in its construction phase, which started in 2016.
Once built, TAP will offer a direct and cost-effective transportation route opening up the vital Southern Gas Corridor, a 3,500-kilometer long gas value chain stretching from the Caspian Sea to Europe.
TAP shareholders include BP (20 percent), SOCAR (20 percent), Snam S.p.A. (20 percent), Fluxys (19 percent), Enagás (16 percent) and Axpo (5 percent).
SOCAR reveals volumes of gas received for Nakhchivan Autonomous Republic
Azerbaijan's state oil company SOCAR obtained about 60 million cubic meters of gas from Iran in January-February 2018 for the needs of the Nakhchivan Autonomous Republic, a source in the country's oil and gas market told Trend March 7.
"As of March 1, 2018, SOCAR received about 60 million cubic meters of gas to supply the Nakhchivan Autonomous Republic, which fully meets the demand," said the source.
Some 402 million cubic meters of Azerbaijani gas are supplied annually to Iran under the long-term (up to 2025) swap agreement in order to meet the demand of Nakhchivan Autonomous Republic for natural gas, some 350 million cubic meters of which are then supplied to Nakhchivan.
Under the agreement on gas imports signed in October 2016 with Iran, 270 million cubic meters of gas was delivered to Nakhchivan in 2017.
Azerbaijan and Iran are connected by the Astara-Bind-Biand gas pipeline with a length of 1,474.5 kilometers, including 296.5 kilometers through Azerbaijan. Its design capacity was 10 billion cubic meters per year, but now this figure is lower. This route is a branch of the Gazakh-Astara-Iran pipeline, commissioned in 1971. Three compressor stations were built along this route in Gazimammad, Agdash and Gazakh.
SOCAR to supply diesel fuel to Ukrainian ministry
SOCAR Energy Ukraine Ltd., a subsidiary of Azerbaijan's state oil company SOCAR, signed a contract with the Ukrainian Defense Ministry for supply of 1,500 tons of arctic diesel fuel for over $1.75 million, a source in the oil and gas market of Azerbaijan told Trend on March 9.
The source said that under the contract, the fuel should be delivered before April 30.
"The contract was signed on March 6. SOCAR Energy Ukraine won the tender of the Defense Ministry of Ukraine and will supply 1,500 tons of arctic diesel fuel at a price of 31,665 hryvnia per ton, thus the total amount of the deal will amount to 47.5 million hryvnia, or about $1.77 million," the source said.
In 2017, SOCAR supplied about 12,000 tons of aviation kerosene to the Ukrainian Defense Ministry.
SOCAR is represented in Ukraine by SOCAR Energy Ukraine, and owns a network of 61 filling stations.
SOCAR, BP launch new project at Baku Higher Oil School
Azerbaijan's state oil company SOCAR and BP have launched the "Business education for engineers" project at the Baku Higher Oil School (BHOS).
This program is provided for fifth-year students of BHOS. As part of the program, students who have received engineering knowledge and high-level skills will also be able to expand their skills in business and management.
The curriculum of the course will consist of: communication and presentation skills, project management, effective time management, leadership, risk management, financial framework and budget and expenditure control, as well as human resource management and negotiation skills.
The project will cover a period of 11 months (from February to December 2018).
The project's cost is $180,000.
In 2017, BP spent $2 million on sponsorship of social projects in Azerbaijan, and $2.4 million together with its partners on projects in the country.
SOCAR allocated 148 million Azerbaijani manats for social projects in 2016.
Azerbaijan’s Salyan Oil company reveals volume of investments for 2018
Azerbaijani operating company Salyan Oil, which is developing the Kursangi and Garabagli onshore oil fields in the country, plans to increase investments in 2018, a source in the country's oil and gas market told Trend.
The source said that the increase in investments will allow the operating company to pay more attention to recovering production at the block.
"According to the approved budget, Salyan Oil plans to invest about $40 million in the development of Kursangi and Garabagli fields in 2018, which is significantly more than in the previous year," the source noted.
The main part of investments will be used for the major overhaul of existing wells, perforation work and the use of expensive new technologies. The main focus of the company will be on maintaining and increasing oil production at the fields, the source added.
Salyan Oil produced about 162,000 tons of oil from Kursangi and Garabagli fields in 2017. Around 445 tons of oil per day is produced from Kursangi and Garabagli fields.
The fields are located in Azerbaijan's Salyan district, around 150 kilometers from Baku. Some experts believe that the remaining oil reserves in the contract area exceed 150 million tons.
The contract for the development of Kursangi-Garabagli was signed in 1998 for a period of 25 years. Participants of Salyan Oil are the Azerbaijani state oil company SOCAR and China National Oil & Gas Exploration and Development.
New technologies to be applied on Azerbaijan's onshore deposit
New technologies are planned to be used when developing the Kursangi and Garabagli onshore fields of Azerbaijan in 2018, a source in the oil and gas market told Trend on March 5.
The source said that the use of new technologies may help raise production levels this year.
"Representatives of Chinese company will arrive in Azerbaijan in the second half of the year for the introduction of the technology. The technology consists of pumping of hot air into the seams, which leads to an increase in the oil extension coefficient. If the introduction of the technology is successful, this year oil production can be expected to be above the planned level, " the source said, without specifying the company's name.
The source said that one can speak about the results of the innovation in October.
"The necessary equipment will be delivered until July, after which another four months will be required to set up works, so in October it will become clear how successful these technologies are," the source said.
Salyan Oil produced around 162,000 tons of oil in 2017. Currently, around 445 tons of oil per day is produced from Kursangi and Garabagli fields.
The fields are located in Azerbaijan's Salyan district, around 150 kilometers from Baku. Some experts believe that the remaining oil reserves in the contract area exceed 150 million tons.
The contract for the development of Kursangi-Garabagli was signed in 1998 for a period of 25 years. Participants of Salyan Oil are the Azerbaijani state oil company SOCAR and China National Oil & Gas Exploration and Development.