Photo: Shah Deniz; Source: Lukoil

Azerbaijan’s oil output drops down considerably from 2020 figures

Azerbaijan’s Ministry of Energy has released oil and gas figures for the past 11 months of this year, which show that the country’s oil production has decreased by 16.5 thousand tons compared to the 2020 figures.

Based on the data provided by the Ministry of Energy on Thursday, Azerbaijan produced 31.6 million tons of oil – including condensate – in the period from January to November 2021, which shows that the production of oil (including condensate) decreased by 16.5 thousand tons compared to the same period a year before.

Source: The Ministry of Energy of the Republic of Azerbaijan

The Azeri-Chirag-Gunashli (ACG) field accounted for 20.6 million tons of oil produced in the country, while the Shah Deniz field produced 3.8 million tons (condensate).

It is worth noting that BP reported in November that 650,000 barrels of crude oil from the Azeri-Chirag-Gunashli (ACG) field in the Caspian travelled all the way from the Sangachal terminal near Baku across Azerbaijan and Georgia and onto the Stamos – the 1000th tanker – which sailed the cargo to Italy.

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On behalf of the ACG coventurers, BP operates the ACG field and holds a 30.37 per cent interest in it. Other participating partners are SOCAR (25 per cent), MOL (9.57 per cent), INPEX (9.31 per cent), Equinor (7.27 per cent), ExxonMobil (6.79 per cent), TPAO (5.73 per cent), ITOCHU (3.65 per cent) and ONGC Videsh Limited (OVL) with 2.31 per cent.

When it comes to the latest developments related to Shah Deniz, the most recent one was reported earlier this month when Lukoil and Petronas changed their previously announced agreement related to Lukoil’s acquisition of an interest in the Shah Deniz natural gas project in the Azerbaijan sector of the Caspian Sea from Petronas.

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Based on the new agreement the share acquired by Lukoil is reduced with a proportional decrease in the transaction value from $2.25 billion to $1.45 billion. The deal is expected to be closed in January 2022. Other parties in the project are BP (operator, 28.8 per cent), TPAO (19 per cent), SOCAR (10 per cent), NICO (10 per cent), and SGC (6.7 per cent).

Azerbaijan’s Ministry of Energy revealed in its report that SOCAR’s oil output amounted to 7.2 million tons (including condensate) for the past 11 months, while the volume of exported oil, including condensate, amounted to 25.7 million tons. Out of this, consortium accounts for nearly 24.5 million tons and SOCAR for more than 1.2 thousand tons.

Furthermore, the transportation of oil (including the condensate) for exporting is approximately 334 thousand tons, namely 1.3 per cent lower than the relevant period of 2020.  

On the other hand, the gas output amounted to 39.7 bcm during these 11 months with 12.1 bcm of gas production extracted from ACG, while 20.4 bcm was extracted from Shah Deniz. SOCAR produced 7.2 bcm of gas during this period and the gas was transported with an increase of approximately 6 bcm – 17.8 per cent – compared to the relevant period last year. 

Source: The Ministry of Energy of the Republic of Azerbaijan

The gas sales amounted to 16.9 bcm during this period, which was 39.8 per cent more compared to the same period during the previous year. The Ministry of Energy further added that 7.7 bcm of gas was exported to Turkey, 7.3 bcm to Europe and 1.8 bcm to Georgia. The BTC pipeline system was supplied with 92 million cubic meters of gas, while 5.1 bcm of gas was exported to Turkey through TANAP during this period.

The data further shows that 578.6 million tons of oil (including condensate) were extracted from Azeri-Chirag-Gunashli and Shah Deniz from their commissioning until 1 December 2021. Additionally, 544.6 million tons of crude oil were extracted from ACG and 34 million tons of condensate from Shah Deniz, while 578.1 million tons oil (including condensate) were exported from these fields.

During the same period, more than 188.7 bcm of gas was extracted from Azeri-Chirag-Gunashli and more than 153 bcm from Shah Deniz, while more than 106.2 bcm of gas was exported from Shah Deniz.

The report further elaborates that Azerbaijan refined 6.1 million tons of oil from January to November 2021, which is 756.6 thousand tons more in comparison with the relevant period of the previous year.