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Tuesday, February 27, 2007

Ceyhan link to pump less Azeri oil

02-16-2007 Upstream onLine - The BP-led Baku-Ceyhan pipeline is set to pump less Azeri oil exports per day in March and there is no sign yet that supplies to Georgia's port of Supsa will resume, trade sources said today. The pipeline to Ceyhan is scheduled to pump about 510,000 barrels per day in March, down from 521,000 bpd planned in February, they said. The March programme has 11 cargoes of 1 million barrels and eight of 600,000 barrels. There is no indication yet that Azeri oil may resume flowing to Georgia's Black Sea port of Supsa in March as a tentative loading schedule has been cancelled, traders said. "I heard that a preliminary programme put together for March has been scrapped," one said. "I've no idea when it's going to start, but it's not going to happen in March," said another of a possible restart. An Azeri oil official had said on Tuesday that pumping may resume along the pipeline to Supsa next month. It has been closed for several months because of technical problems. BP, the main user of the pipeline, has declined to confirm that March was the deadline for the pipeline reopening. A schedule for Azeri exports from Batumi in Georgia in March has yet to be released, traders said. February's programme listed six 600,000-barrel cargoes for loading at Batumi, Reuters reported.

Thursday, February 15, 2007

Azerbaijan GDP up 46.7% in 1M07, y-on-y

AzerbaijanBAKU, February 15 (RIA Novosti) - Azerbaijan's gross domestic product grew 46.7% in January, year-on-year, or by 524 million manat (over $681 million), to 1.6 billion manat (about $2.1 billion), the statistics committee of the energy-rich South Caucasus nation said Thursday. It said per capita GDP in the reporting period was 195.7 manat, or $224.6. The production sector contributed 75.1% to GDP, including 66.7% from industry. The construction sector accounted for 6.3%, agriculture and forestry 2.1%, and the services sector 19.9%. Azerbaijan holds vast oil and gas reserves in the Caspian, which it exports to neighboring Georgia, Turkey and Europe. The high oil price was a major factor in the country's impressive GDP growth.

Friday, February 09, 2007

Georgia eyes Shah Deniz supply

02-09-2007 - Upstream onLine - Georgia, seeking to lessen its dependence on Russian energy, wants to negotiate a bigger long-term share of natural gas from the Shah Deniz field in neighbouring Azerbaijan, according to reports. Energy Minister Nika Gilauri told Reuters Georgia aimed to extend a deal with Azerbaijan and Turkey, which also buys gas from Shakh Deniz, to secure supplies until 2011 from the project run by a consortium led by BP and Norway's Statoil. "All sides should sit down and talk not only about 2008, but also about 2009 to 2011. We should expect a new redistribution," Gilauri said in an interview published today. Georgia is entitled by an agreement signed in the late-1990s to receive only 250 million cubic metres of natural gas in 2007 from Shah Deniz. This will increase to 800 Mmcm in 2010-11 - still much less than Georgia wants to buy. Tbilisi has a preliminary agreement with Turkey for a further 800 Mmcm this year. It wants to extend this over 2008 and beyond to avoid a repeat of the price shocks prompted by Russia's more than doubling of the gas price to $235 per 1000 cubic metres from the start of 2007. "We're not saying we don't want Gazprom's gas," Gilauri said, referring to Russia's gas monopoly. "On the contrary, we're saying we don't want natural gas only from Shah Deniz. Volumes of Russian gas purchased will depend on price," Gilauri said.

Total restarts Apsheron talks

02-09-2007 - Upstream onLine - French giant Total has revived talks with Azerbaijan on developing the Apsheron gas field, in the Caspian Sea, after the previous consortium fell apart due to poor drilling results. Azeri state oil player Socar said in a statement released today that it had signed a memorandum of understanding with Total over the Apsheron Block in the Caspian Sea and hoped to sign a full production sharing agreement within a year. Total and Socar were part of the group led by Chevron that failed to find commercial reserves when it drilled the first exploration well on Apsheron in 2001. Chevron decided against continuing operations after investing more than $75 million in the first well and walked out of the deal, paying Socar compensation. Socar says Apsheron gas reserves could be as high as 1 trillion cubic metres, comparable to the neighbouring giant Shah Deniz field, which is due to start pumping gas to Turkey later this year.

Georgia accuses Moscow of punishing Azerbaijan

09-02-2007 - RBC News - Georgian President Mikhail Saakashvili said Russia punished Azerbaijan for its help to Georgia in terms of gas supplies. “There are three countries in the region. First Russia raised the price of gas to $235 for Georgia. After Azerbaijan said it would supply gas to Georgia, Russia raised the price for Azerbaijan as well,” Saakashvili said at a joint news conference with Azeri President Ilham Aliyev and Turkish Prime Minister Recep Tayyip Erdogan in Tbilisi. The three leaders signed an agreement on the construction of the Baku-Tbilisi-Akhalkalaki-Kars railway. Despite the increased price of Russian gas, and, as a result, its absence, Azerbaijan started using a more expensive fuel in order to sell its gas to Georgia. “Georgian people should never forget that,” Saakashvili stressed. “This is the beginning of big partnership, brotherhood and friendship,” he stressed. Russian gas giant Gazprom raised the price of gas for Georgia from $110 to $235 per 1,000 cubic meters from 1 January 2007. Georgia currently receives natural gas from Azerbaijan at $120 per 1,000 cubic meters. Azeri authorities want to increase the size of supplies through boosting production at the Shaz-Deniz field in the Caspian Sea. Azerbaijan will become Georgia’s key gas supplier. Mikhail Saakashvili also stressed Turkey’s important role in Georgia’s economic development. In particular, the construction of new airports in Tbilisi and Batumi was financed by Turkish businessmen.

Azerbaijan SOCAR, French Total to develop Caspian oil field

BAKU, February 9 (RIA Novosti) - The State Oil Company of Azerbaijan (SOCAR) and France's Total have signed a memorandum of understanding to develop the Absheron oil fields in the Caspian, the SOCAR press service said Friday. It said the two companies are to harmonize and sign a production-sharing agreement within a year. "Total's interest in the project to develop the Absheron deposits shows that geological structures that were once considered commercially non-viable have rich hydrocarbon reserves," SOCAR said.

Tuesday, February 06, 2007

U.S. diplomat to discuss diversification of Kazakh hydrocarbon exports

05 February 2007 - BakuTODAY - A U.S. delegation headed by Assistant Secretary of State for Economic, Energy and Business Affairs Daniel Sullivan has arrived in Astana to discuss diversifying Kazakhstan's oil and gas export routes. The discussion will not focus solely on routes by-passing Russia, he said. However, the Russian transportation system will not be able handle the ever-increasing volumes of Kazakh oil and gas exports to Europe, he said. Diversification of Kazakhstan's export routes is an issue today because of the significant increase in oil production projected in coming years, Sullivan said, adding that 100% of Kazakh gas and 90% of Kazakh oil are currently exported through Russia. Sullivan also said it is high time that Kazakhstan joins the Baku- Tbilisi-Ceyhan oil pipeline project. The trans-Caspian pipeline is key for Kazakh gas exports, Sullivan said. He hopes that American companies operating in that region will join the project. The United States wishes to discuss the Caspian Pipeline Consortium development with Kazakhstan, Russia and other investors, Deputy Assistant Secretary of State for European and Eurasian Affairs Matthew Bryza told the press conference. A decision to build the trans-Caspian pipeline may be made when Kazakhstan expands gas production, and the United States hopes that will happen in five, ten or fifteen years, he said. Sullivan will meet with Kazakh officials in Astana to discuss energy, export opinions, regional and economic integration, economic diversification, and Kazakhstan's accession to the World Trade Organization (WTO). The delegation will also visit Azerbaijan, Turkey and Georgia and attend an international conference on Caspian energy in Paris.

3 documents expected to be signed at Azerbaijan-US Economic Partnership Commission's meeting

05 February 2007 - Today.Az - "Bilateral economic relations between Azerbaijan and the United States rose to partnership from cooperation in 2006. "As a result of this, the working group on Azerbaijan-US economic cooperation is substituted by Economic Partnership Commission. The first meeting of the commission will be held on February 7 this year in Baku," said Azeri Ambassador to the US Yashar Aliyev. Ambassador said three documents, including the project of Cooperation Memorandum on establishing Economic Partnership Commission between Azerbaijani and the US governments, Memorandum of Understanding on dialogue of energy security in the Caspian region between Azerbaijani and the US governments and Joint Communique of Economic Partnership Commission, for adoption in the framework of the meeting are being discussed at present, APA reports. Aliyev also added that the US has established such commissions with 10-15 states for continuation of economic relations. "This fact also shows the importance of this commission for Azerbaijan," Ambassador said.

Shah Deniz gas to reach Georgia in two weeks

02 February 2007 - Azeri Press Agency - Georgia is reshaping its energy balance to reduce gas consumption as much as possible by closing gas-fuelled power plants. It only generates electricity through hydroelectric plants and power block 9. Ajaria is completely supplied with Turkish gas under an exchange deal. Enquri hydroelectric power plant is producing electricity at full capacity. Georgia is receiving natural gas from Russia and Azerbaijan. However, Shah Deniz gas is not flowing to Georgia at present. Energy Minister, Nika Gilauri said Shah Denis gas is expected to reach Georgia in two weeks. "We did the best to minimize gas consumption in the country. Also, we try to increase the quota of low-priced gas in the energy balance," he underscored. He said Georgia will be receiving natural gas in normal regime from April, including 1mln cu m of Azeri and Shah Deniz gas a day, 1mln cu m from Russian gas transit to Armenia, 1.5mln cu m from Turkey’s quota in Shah Deniz project, and this amount will cover the needs of population and industry. BP Office in Georgia told the APA that the time of Shah Deniz gas imports resumption is indefinite. The repair works are carried out to prevent technical failure in future, preventive works are underway in gas and condensate fields.

80 tankers carrying Azeri Light oil sail to world market from Ceyhan

31 January 2007 - Azeri Press Agency - 80 tankers carrying 7.671mln tons of Azeri Light crude oil have to date sailed from Ceyhan Port to the world market. The grant project of the millennium- Baku-Tbilisi-Ceyhan (BTC) Oil Pipeline- is delivering Azeri oil to Ceyhan, a Turkish port, via Georgia and Turkey. The pipeline delivered 7.966mln tons of crude oil extracted from Azeri-Chirag-Guneshli Field since it came on line on June 13, 2006, while its capacity is 50mln tons annually.

Azerbaijan and Russia deepen industry and energy cooperation

31 January 2007 - Today.Az - Head of Russia's Trade Office in Azerbaijan, Yuri Shedrin, met with Azerbaijan's Industry and Energy Minister, Natig Aliyev. Yuri Shedrin told the APA that the meeting focused on bilateral energy cooperation potential and joint implementation of a number of projects etc. He said bilateral cooperation in electronics and energy, engineering, car-making and oil engineering are of great importance. The parties agreed to meet every month to discuss project processes.

SOCAR sells 852,674 tons of diesel fuel to France's Total

31 January 2007 - Today.Az – State Oil Company of Azerbaijan (SOCAR) sold 852,674 tons of diesel fuel to Total Company of France in 2006. SOCAR told APA that 58,355 tons were sold in January, 63,708 tons in February, 67,500 tons in March, 82,000 tons in April, 99,014 tons in May and 72,600 tons in June, 107,000 tons in July, 94,000 tons in August, 59,627 tons in September and 40,000 tons in October, 50,077 tons in November, and 57,793 tons in December. Diesel fuel is sold to French company under the contract signed in December last year.

Crude still being pumped between Baku and Russian seaport

30 January 2007 - RBC News - Some 360,000 tonnes of oil will be pumped through the Baku-Novorossiysk pipeline in February 2007 in accordance with Azerbaijan's order as of January 15, 2007. Commenting on statements by Azeri spokesmen on intentions to refuse oil supplies through this pipeline, Transneft told RBC that crude was being pumped along this route according to normal procedure. No official documents confirming Azerbaijan's abovementioned intentions have been received at Transneft. More than 4m tonnes of Azeri oil was transported annually through this pipeline for the past few years, the Russian company explained. The volume of oil supply along the Baku-Novorossiysk route is planned at the previous year's level of 4.6m tonnes in 2007.

SOCAR raises salary 25%

30 January 2007 - Today.Az - Under the decision made by the State Oil Company of Azerbaijan sand Oil and Gas Industry Labor Union, there will be a 25% rise in salary effective on Feb 1. SOCAR press service told the APA that the free dinner for employees will be replaced with additional payments of AZN 2 per working day. The move comes after the presidential decree to increase minimum wage.

Azerbaijan announces tender for export of Azeri Light Crude

30 January 2007 [00:27] - Today.Az – SOCAR Marketing and Economic Operations Department has announced a tender for oil export. The tender winner will export 1mln barrel of Azeri Light crude oil from Ceyhan Port on February 28-March 2. The bid opening will be held on Feb.1, SOCAR told the APA.

Karasu Operating Company cuts gas production

26 January 2007 - Today.Az - Karasu Operating Company (KAOC), dealing with exploration and development of the Mishovdag and Kelameddin onshore oilfields in Azerbaijan, produced 4,648,000 cu m of gas during 2006, 23.9% down from the previous year. Company's head office told the APA that the gas output reached 400,000 cubic meters in December, 2006. KAOC was established by SOCAR (15%) and Nations Energy Corp (85%).

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