State Oil Company of Azerbaijan
Encyclopedia
The State Oil Company of Azerbaijan Republic (SOCAR) is the state-owned oil and natural gas corporation of Azerbaijan
. It is considered to be one of the largest oil companies in the world. It produces oil
and natural gas
, operates the country's two oil refineries and the running of oil and gas pipeline
s throughout the country. 'SOCAR' oversees the international consortia that is developing new oil and gas projects in Azerbaijan. SOCAR is ranked the 68th largest company in the world and is worth $20 billion.
by merger of Azerbaijan's two state oil companies, Azerneft and Azneftkimiya. Azerneft was created after the Bolshevik revolution through the nationalization
of the Azerbaijan
i oil industry. During the Soviet period, Azerneft was incorporated into the new Azerbaijan Oil Industry Ministry (1954–1959) and went through several reorganizations and re-namings. In August 1970, it was renamed back to Azerneft. According to the Presidential Decree No. 50, the company was restructured and several entities within the organization were established to improve management of exploration and production activities in Azerbaijan. On 24 January 2003, another set of organizational restructuring as per Presidential Decree No. 844:
In 1994, SOCAR signed the "Contract of the Century" for the production of oil in the Caspian Sea
.
and offshore
oil and gas fields in Azerbaijan Republic, transportation, processing, refining and sale of oil, gas, condensate and other related products. It employs more than between 58,945 and 70,000 people. Azerbaijan has 57 oil fields in Azerbaijan, 18 of which are offshore, in Azerbaijani sector of the Caspian Sea
. According to the Energy Information Administration of the U.S. Department of Energy, as of December 2007, SOCAR has signed 14 offshore and 10 onshore production sharing agreements (PSA) with foreign private corporations.
In 2006, SOCAR's production was at about 7.84 million tonnes of oil and 4.34 billion cubic meters of gas. As of January 2009, oil refineries managed by SOCAR have a refining capacity of 339,000 barrels a day.
s (PSA). The first agreement was signed to develop Azeri-Chirag-Guneshli
fields beginning on 20 September 1994, and the latest agreement was signed in 2009 for exploration of Bahar
and Gum Deniz
offshore oil fields. SOCAR also has a share in two major export pipelines Baku-Tbilisi-Ceyhan pipeline
and South Caucasus Pipeline
.
SOCAR has a 25% stake in the Baku-Tbilisi-Ceyhan pipeline and 10% in South Caucasus Pipeline. It also has stakes in the Baku-Supsa Pipeline
and Baku-Novorossiysk Pipeline
.
SOCAR's head office is located at a three-story building constructed in the French renaissance style, facing the Azneft square in downtown Baku.
Representative offices of SOCAR are located in Bucharest
, Frankfurt am Main, Geneva
, London
, Istanbul
, Vienna
, Astana
, Tehran
. In Romania, SOCAR considers building a petrochemical refinery complex to supply European countries with oil products.
Austrian and German offices of SOCAR promote transportation of Azerbaijani hydrocarbons from Azerbaijan to Europe as well as realization of Nabucco project
in cooperation with Austria's largest oil producing, refining and gas station operating company OMV
. OMV had been transporting some of Azeri Light crude oil from Georgian port of Supsa
. Swiss office is represented by subsidiary of SOCAR located in Geneva, SOCAR Trading SA which started its operations in 2008 is handling marketing of the Azerbaijani oil in Europe. Capital stock of the company is 5 million Swiss franc
s In November 2011, SOCAR bought ExxonMobil
subsidiary Esso
Schweiz for an undisclosed amount. Esso Schweiz has 172 filling stations and around 885 people in its staff.
, construction of oil terminals and warehouses. The company holds 72% and 61% of petroleum and diesel markets, respectively. SOCAR Energy Georgia, Ltd. also owns the Kulevi oil terminal
. SOCAR supplies Georgia with 20,000 tonnes of oil products a month, including 15,000 tonnes of gasoline. The company has so far invested $400 million in Georgian economy and was reportedly Georgia's biggest taxpayer in 2009. SOCAR paid 162 million Georgian lari
($1 = 1.70 Lari) in tax in 2009. The company was the biggest taxpayer three times in a row.
. SOCAR also received New Millenium Award in July 2000 in Paris
. The award is an international award for quality presented on behalf of 14,000 enterpreneurs from 112 countries.
, was appointed president of SOCAR. He replaced Natig Aliyev
, who had been named Azerbaijan's Minister of Industry and Energy
.
Azerbaijan
Azerbaijan , officially the Republic of Azerbaijan is the largest country in the Caucasus region of Eurasia. Located at the crossroads of Western Asia and Eastern Europe, it is bounded by the Caspian Sea to the east, Russia to the north, Georgia to the northwest, Armenia to the west, and Iran to...
. It is considered to be one of the largest oil companies in the world. It produces oil
Oil
An oil is any substance that is liquid at ambient temperatures and does not mix with water but may mix with other oils and organic solvents. This general definition includes vegetable oils, volatile essential oils, petrochemical oils, and synthetic oils....
and natural gas
Natural gas
Natural gas is a naturally occurring gas mixture consisting primarily of methane, typically with 0–20% higher hydrocarbons . It is found associated with other hydrocarbon fuel, in coal beds, as methane clathrates, and is an important fuel source and a major feedstock for fertilizers.Most natural...
, operates the country's two oil refineries and the running of oil and gas pipeline
Pipeline transport
Pipeline transport is the transportation of goods through a pipe. Most commonly, liquids and gases are sent, but pneumatic tubes that transport solid capsules using compressed air are also used....
s throughout the country. 'SOCAR' oversees the international consortia that is developing new oil and gas projects in Azerbaijan. SOCAR is ranked the 68th largest company in the world and is worth $20 billion.
History
SOCAR was established on 13 September 1992, by Decree 200 of President of Azerbaijan RepublicPresident of Azerbaijan
The country of Azerbaijan is a presidential republic, with the President of Azerbaijan as the head of state, and the Prime Minister of Azerbaijan as head of government...
by merger of Azerbaijan's two state oil companies, Azerneft and Azneftkimiya. Azerneft was created after the Bolshevik revolution through the nationalization
Nationalization
Nationalisation, also spelled nationalization, is the process of taking an industry or assets into government ownership by a national government or state. Nationalization usually refers to private assets, but may also mean assets owned by lower levels of government, such as municipalities, being...
of the Azerbaijan
Azerbaijan
Azerbaijan , officially the Republic of Azerbaijan is the largest country in the Caucasus region of Eurasia. Located at the crossroads of Western Asia and Eastern Europe, it is bounded by the Caspian Sea to the east, Russia to the north, Georgia to the northwest, Armenia to the west, and Iran to...
i oil industry. During the Soviet period, Azerneft was incorporated into the new Azerbaijan Oil Industry Ministry (1954–1959) and went through several reorganizations and re-namings. In August 1970, it was renamed back to Azerneft. According to the Presidential Decree No. 50, the company was restructured and several entities within the organization were established to improve management of exploration and production activities in Azerbaijan. On 24 January 2003, another set of organizational restructuring as per Presidential Decree No. 844:
- merged offshore and onshore gas production units establishing Azneft production unit;
- merged the Foreign Economic Ties Department with 'Azernefttejhizat' unit forming the Marketing and Economic Operations Department;
- established the Oil Lines Department on the basis of main oil lines production unit;
- established Baku Deep Water Jacket Plant on the basis of 'Shelflayihetikinti' production unit;
- established Azerneftyagh oil refinery on the basis of Azerneftyagh production unit;
- established Azerneftyanajag oil refinery on the basis of Azerneftyanajag production unit;
- announced IPO for Khezerdenizgazmatikinti, Khezerdenizneftsosialtikinti units and auto transport bureau of SOCAR.
In 1994, SOCAR signed the "Contract of the Century" for the production of oil in the Caspian Sea
Caspian Sea
The Caspian Sea is the largest enclosed body of water on Earth by area, variously classed as the world's largest lake or a full-fledged sea. The sea has a surface area of and a volume of...
.
Operations
SOCAR's activities are exploration, preparation, exploitation of onshoreOnshore (hydrocarbons)
Onshore, when used relative to hydrocarbons, refers to an oil, natural gas or condensate field that is under dry land or to activities or operations carried out in relation to such a field.-References:* *...
and offshore
Offshore (hydrocarbons)
"Offshore", when used relative to hydrocarbons, refers to an oil, natural gas or condensate field that is under the sea, or to activities or operations carried out in relation to such a field...
oil and gas fields in Azerbaijan Republic, transportation, processing, refining and sale of oil, gas, condensate and other related products. It employs more than between 58,945 and 70,000 people. Azerbaijan has 57 oil fields in Azerbaijan, 18 of which are offshore, in Azerbaijani sector of the Caspian Sea
Caspian Sea
The Caspian Sea is the largest enclosed body of water on Earth by area, variously classed as the world's largest lake or a full-fledged sea. The sea has a surface area of and a volume of...
. According to the Energy Information Administration of the U.S. Department of Energy, as of December 2007, SOCAR has signed 14 offshore and 10 onshore production sharing agreements (PSA) with foreign private corporations.
In 2006, SOCAR's production was at about 7.84 million tonnes of oil and 4.34 billion cubic meters of gas. As of January 2009, oil refineries managed by SOCAR have a refining capacity of 339,000 barrels a day.
Projects
Since 1994, SOCAR has signed 28 production sharing agreementProduction sharing agreement
Production sharing agreements are a common type of contract signed between a government and a resource extraction company concerning how much of the resource extracted from the country each will receive....
s (PSA). The first agreement was signed to develop Azeri-Chirag-Guneshli
Azeri-Chirag-Guneshli
Azeri–Chirag–Guneshli is a large complex of oil fields in the Caspian Sea, about off the coast of Azerbaijan. An overall estimated area of the field is . It is operated by a BP-led consortium. The ACG fields have estimated recoverable reserves of about of petroleum...
fields beginning on 20 September 1994, and the latest agreement was signed in 2009 for exploration of Bahar
Bahar oilfield
Bahar is an offshore oil and gas field in the Caspian Sea, located southeast of Baku, Azerbaijan.The field has been discovered in 1968 and was developed since 1969. Bahar has produced a little over 16.8 million tonnes of oil and 128.7 billion cubic meters of gas up until 2010...
and Gum Deniz
Gum Deniz oilfield
Gum Deniz is an offshore oil and gas field in the Caspian Sea, located southeast of Baku, Azerbaijan.The field has been in operation since 1955. Gum Deniz has produced approximately 28.9 million tonnes of oil and 27 billion cubic meters of gas to date. In March 2009, Azerbaijan drilled its last...
offshore oil fields. SOCAR also has a share in two major export pipelines Baku-Tbilisi-Ceyhan pipeline
Baku-Tbilisi-Ceyhan pipeline
The Baku–Tbilisi–Ceyhan pipeline is a long crude oil pipeline from the Azeri-Chirag-Guneshli oil field in the Caspian Sea to the Mediterranean Sea. It connects Baku, the capital of Azerbaijan; Tbilisi, the capital of Georgia; and Ceyhan, a port on the south-eastern Mediterranean coast of Turkey,...
and South Caucasus Pipeline
South Caucasus Pipeline
South Caucasus Pipeline is a natural gas pipeline to transport natural gas from the Shah Deniz gas field in the Azerbaijan sector of the Caspian Sea to Turkey...
.
SOCAR has a 25% stake in the Baku-Tbilisi-Ceyhan pipeline and 10% in South Caucasus Pipeline. It also has stakes in the Baku-Supsa Pipeline
Baku-Supsa Pipeline
The Baku–Supsa Pipeline is an long oil pipeline, which runs from the Sangachal Terminal near Baku to the Supsa terminal in Georgia. It transports oil from the Azeri-Chirag-Guneshli field. The pipeline is operated by BP.-History:The preparations for the pipeline's construction started in 1994...
and Baku-Novorossiysk Pipeline
Baku-Novorossiysk Pipeline
The Baku–Novorossiysk pipeline is an long oil pipeline, which runs from the Sangachal Terminal near Baku to the Novorossiysk terminal at the Black Sea coast in Russia...
.
Locations
Representative offices of SOCAR are located in Bucharest
Bucharest
Bucharest is the capital municipality, cultural, industrial, and financial centre of Romania. It is the largest city in Romania, located in the southeast of the country, at , and lies on the banks of the Dâmbovița River....
, Frankfurt am Main, Geneva
Geneva
Geneva In the national languages of Switzerland the city is known as Genf , Ginevra and Genevra is the second-most-populous city in Switzerland and is the most populous city of Romandie, the French-speaking part of Switzerland...
, London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
, Istanbul
Istanbul
Istanbul , historically known as Byzantium and Constantinople , is the largest city of Turkey. Istanbul metropolitan province had 13.26 million people living in it as of December, 2010, which is 18% of Turkey's population and the 3rd largest metropolitan area in Europe after London and...
, Vienna
Vienna
Vienna is the capital and largest city of the Republic of Austria and one of the nine states of Austria. Vienna is Austria's primary city, with a population of about 1.723 million , and is by far the largest city in Austria, as well as its cultural, economic, and political centre...
, Astana
Astana
Astana , formerly known as Akmola , Tselinograd and Akmolinsk , is the capital and second largest city of Kazakhstan, with an officially estimated population of 708,794 as of 1 August 2010...
, Tehran
Tehran
Tehran , sometimes spelled Teheran, is the capital of Iran and Tehran Province. With an estimated population of 8,429,807; it is also Iran's largest urban area and city, one of the largest cities in Western Asia, and is the world's 19th largest city.In the 20th century, Tehran was subject to...
. In Romania, SOCAR considers building a petrochemical refinery complex to supply European countries with oil products.
Austrian and German offices of SOCAR promote transportation of Azerbaijani hydrocarbons from Azerbaijan to Europe as well as realization of Nabucco project
Nabucco Pipeline
The Nabucco pipeline is a proposed natural gas pipeline from Erzurum in Turkey to Baumgarten an der March in Austria diversifying natural gas suppliers and delivery routes for Europe. The pipeline attempts to lessen European dependence on Russian energy...
in cooperation with Austria's largest oil producing, refining and gas station operating company OMV
OMV
OMV is Austria's largest oil-producing, refining and gas station operating company with important activities in other Central European countries...
. OMV had been transporting some of Azeri Light crude oil from Georgian port of Supsa
Supsa
Supsa is a Black Sea port village in western Georgia. It is located at around .It is the terminus of the Western Early Oil pipeline from Azerbaijan and the Caspian Sea oil fields....
. Swiss office is represented by subsidiary of SOCAR located in Geneva, SOCAR Trading SA which started its operations in 2008 is handling marketing of the Azerbaijani oil in Europe. Capital stock of the company is 5 million Swiss franc
Swiss franc
The franc is the currency and legal tender of Switzerland and Liechtenstein; it is also legal tender in the Italian exclave Campione d'Italia. Although not formally legal tender in the German exclave Büsingen , it is in wide daily use there...
s In November 2011, SOCAR bought ExxonMobil
ExxonMobil
Exxon Mobil Corporation or ExxonMobil, is an American multinational oil and gas corporation. It is a direct descendant of John D. Rockefeller's Standard Oil company, and was formed on November 30, 1999, by the merger of Exxon and Mobil. Its headquarters are in Irving, Texas...
subsidiary Esso
Esso
Esso is an international trade name for ExxonMobil and its related companies. Pronounced , it is derived from the initials of the pre-1911 Standard Oil, and as such became the focus of much litigation and regulatory restriction in the United States. In 1972, it was largely replaced in the U.S. by...
Schweiz for an undisclosed amount. Esso Schweiz has 172 filling stations and around 885 people in its staff.
SOCAR Energy Georgia, Ltd.
SOCAR's subsidiary SOCAR Energy Georgia, Ltd. was founded in 2006. The company is engaged in retail and wholesale of fuel, import of petroleum and LNGLiquefied natural gas
Liquefied natural gas or LNG is natural gas that has been converted temporarily to liquid form for ease of storage or transport....
, construction of oil terminals and warehouses. The company holds 72% and 61% of petroleum and diesel markets, respectively. SOCAR Energy Georgia, Ltd. also owns the Kulevi oil terminal
Kulevi oil terminal
The Kulevi oil terminal is an oil port on the eastern Black Sea coast in Georgia. The terminal is located in Khobi District, close to the populated area of the village Kulevi, and from the coastal area between rivers Tsiva and Khobistskali.-Construction:...
. SOCAR supplies Georgia with 20,000 tonnes of oil products a month, including 15,000 tonnes of gasoline. The company has so far invested $400 million in Georgian economy and was reportedly Georgia's biggest taxpayer in 2009. SOCAR paid 162 million Georgian lari
Georgian lari
The lari is the currency of Georgia. It is divided into 100 tetri. The name lari is an old Georgian word denoting a hoard, property, while tetri is an old Georgian monetary term used from the 13th century....
($1 = 1.70 Lari) in tax in 2009. The company was the biggest taxpayer three times in a row.
Social Responsibility
The company has participated in construction of treatment and diagnostic centers in 10 regions of Azerbaijan. In March 2001, SOCAR was awarded the Arch of Europe Award for Quality and Technology at an award ceremony in Frankfurt, GermanyGermany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
. SOCAR also received New Millenium Award in July 2000 in Paris
Paris
Paris is the capital and largest city in France, situated on the river Seine, in northern France, at the heart of the Île-de-France region...
. The award is an international award for quality presented on behalf of 14,000 enterpreneurs from 112 countries.
Management
In January 2006 the former head of the Baku Oil Refinery and a member of the Azerbaijani parliament, Rovnag AbdullayevRovnag Abdullayev
Rovnag Ibrahim oglu Abdullayev is the director of the SOCAR oil company and has been president of the Association of Football Federations of Azerbaijan since 2008...
, was appointed president of SOCAR. He replaced Natig Aliyev
Natig Aliyev
Natiq Aliyev Agaami oglu is an Azerbaijani politician who serves as the Minister of Industry and Energy of Azerbaijan Republic-Early life:Aliyev was born on November 23, 1947 in Baku, Azerbaijan. In 1970, he graduated from Azerbaijan State Oil Academy. He has a PhD in Geology-Mineralogy Sciences...
, who had been named Azerbaijan's Minister of Industry and Energy
Ministry of Industry and Energy (Azerbaijan)
The Ministry of Industry and Energy of Azerbaijan Republic is a governmental agency within the Cabinet of Azerbaijan in charge of regulating the activities in the industry production and energy sector of Azerbaijan Republic. The ministry is headed by Natig Aliyev.-History:The ministry was...
.
See also
- List of companies of Azerbaijan
- Kulevi oil terminalKulevi oil terminalThe Kulevi oil terminal is an oil port on the eastern Black Sea coast in Georgia. The terminal is located in Khobi District, close to the populated area of the village Kulevi, and from the coastal area between rivers Tsiva and Khobistskali.-Construction:...
- Azeri-Chirag-GuneshliAzeri-Chirag-GuneshliAzeri–Chirag–Guneshli is a large complex of oil fields in the Caspian Sea, about off the coast of Azerbaijan. An overall estimated area of the field is . It is operated by a BP-led consortium. The ACG fields have estimated recoverable reserves of about of petroleum...
- Baku-Novo Filya gas pipeline
- Karabakh (Oil and Gas field)
- Azeri Oil Field
- Chirag oil fieldChirag oil fieldChirag is an offshore oil field in the Caspian Sea, located east of Baku, Azerbaijan and is a part of the larger Azeri-Chirag-Guneshli project. The production, drilling and quarters platform Chirag 1 has been in operation since 1997. Chirag 1 has been producing the Early Oil from the ACG field...
- Gunashli Oil field
- Bahar oilfieldBahar oilfieldBahar is an offshore oil and gas field in the Caspian Sea, located southeast of Baku, Azerbaijan.The field has been discovered in 1968 and was developed since 1969. Bahar has produced a little over 16.8 million tonnes of oil and 128.7 billion cubic meters of gas up until 2010...
- Gum Deniz oilfieldGum Deniz oilfieldGum Deniz is an offshore oil and gas field in the Caspian Sea, located southeast of Baku, Azerbaijan.The field has been in operation since 1955. Gum Deniz has produced approximately 28.9 million tonnes of oil and 27 billion cubic meters of gas to date. In March 2009, Azerbaijan drilled its last...