News Archive

16 July 2021

Drilling, production, refining and export figures for the 2nd quarter of 2021


Due to the global oil demand growth, driven by COVID-19 vaccination, OPEC+ continued easing the restrictions on production volumes for participating countries. This has led to the stabilization and growth of crude oil production at SOCAR. In the second quarter of 2021, about 2 million tons1 of crude oil and 2 billion cubic meters2 of natural gas were produced on the fields operated directly by SOCAR, a 7% increase both in oil and gas production in comparison to the same period of last year. SOCAR reduced the volume of drilling operations during the quarter, as one of optimization measures, down to 14 thousand meters5, as compared to the same period of the last year.

Nationwide natural gas production increased in comparison to the same period last year and was about 10 billion cubic meters3. Oil production slightly declined to 8.4 million tons4.

In the second quarter, SOCAR refined more than 1.8 million tons of crude oil6, a 24% increase from the second quarter of 2020. The company’s gas processing plant processed 819 million cubic meters7 of natural gas in the second quarter.

SOCAR exported 4.2 million tons8 of crude oil to world market in the reporting period. The volume of SOCAR’s crude exports includes both oil produced on its owned and operated fields and shares of SOCAR and Azerbaijan within the international consortiums. The country’s total gas export exceeded 3.5 billion cubic meters9, a 17% increase as compared to the same period of the last year. The export of refinery and petrochemical products totaled about 755 thousand tons10, which accounts for a 13% increase from the second quarter of the last year.

In the second quarter of this year, the actual level of gas consumption was ca. 2.2 billion cubic meters11 in the country.

Note: The numbers in the text are rounded for readability. The exact figures are shown in the following references.

1- 1,988,147 tons

2 - 1,954,781,093 cubic meters

3- 9,953,383,000 cubic meters

4- 8,420,842 tons

5- 14,043 meters

6 - 1,815,190 tons

7-819,046,000 cubic meters

8- 4,196,877 tons

9- 3,511,183,000 cubic meters

10- 755,713 tons

11- 2,157,463,036 cubic meters

15 July 2021

SOCAR and Technip Energies enter a cooperation agreement on offshore sustainable energy development


SOCAR and Technip Energies entered today a cooperation agreement to study sustainability measures in the offshore upstream activities, including CO2 emission reduction, improvement of power efficiency and associated optimization in the total cost of ownership. The cooperation agreement includes evaluation of a joint pilot project for offshore energy production on a floating wind turbine. The pilot project envisages energy supply for upstream operations in the Caspian Sea. This would be the first case of offshore wind energy production in Azerbaijan.

At present, upstream operations in the Caspian Sea mainly use electricity generated from natural gas. Among the main objectives of the pilot project is to determine the prospects for the supply of sustainable energy to the upstream sector of Azerbaijan, reduce natural gas consumption and increase gas exports.

The agreement was signed by Rovnag Abdullayev, SOCAR president and Marco Villa, Technip Italy S.p.A. Chairman of the Board. Speaking at the signing ceremony, the president of SOCAR said: “The energy efficiency is in focus of many energy companies and is an important part of SOCAR's strategic plans. In line with the development trends of technology, we are already entering this area. Our goal is to reduce operating costs, increase energy efficiency and ensure the sustainability of operations at SOCAR.

Technip Energies is a company with valuable experience in the field of sustainable energy. We have had fruitful cooperation with Technip Italy in other areas, such as the modernization of our Azerkimya petrochemical complex. I am confident that the partner company, which is interested in various new areas of cooperation in our country, such as green chemistry, digitalization and sustainable energy development, can succeed in these areas as well.”

Marco Villa, Chief Operating Officer of Technip Energies, said: “We are proud to cooperate with SOCAR, a long-standing Client, which is committed to a sustainable development toward new energies. This collaboration is fully in line with our ambition to accelerating the transition toward a low carbon society”.

This year Technip has successfully completed its role in the modernization project of SOCAR Azerkimya, which started back in 2016. With more than 60 years of experience, Technip Energies operates in 34 countries around the world. The company has 15,000 employees. Technip Energies provides engineering and construction services in LNG (liquefied gas), hydrogen production, sustainable (green) chemistry, biofuels, decarbonization and other fields.

1 July 2021

SOCAR announces financial report 2020

The company has managed to reduce the expected losses during the pandemic as a result of optimization


In 2020, a year remembered as the most turbulent period in the history of the world oil industry, SOCAR managed to reduce the expected net loss due to its positive performance in the development of oil and gas fields, transportation and sales of hydrocarbons. The company's total turnover in the reporting year amounted to AZN 49.6 billion. The turnover decrease was due to the sharp price decline on the global crude oil and natural gas markets, as well as due to the collapse of petrochemical revenue margins.

Although 2020 was a difficult period mainly in the upstream segment, SOCAR earned AZN 1.4 billion in this segment thank to substantial optimization measures implemented , and AZN 300 million in trade, distribution and sales. This is even more than the total net profit of AZN 1.6 billion in 2019 for these two segments.

However, the company suffered from economic effects of the pandemic in other areas of its operations, including foreign exchange losses in Turkey, where a major part of SOCAR’s foreign investment is concentrated. The amount of these losses surpassed the positive results obtained in other segments, ultimately resulting in loss. Thus, SOCAR's net loss for the year amounted to AZN 1.7 billion. Since 2008, when the company began publishing its consolidated financial statements, this is the second year, which SOCAR finished with a net loss result. In 2015, the company closed the reporting year with a net loss due to devaluation, while all other years between 2008 and 2019 resulted in net profit.

In 2020, the value of SOCAR's total assets is estimated at AZN 64.2 billion, current assets amount to AZN 18.3 billion and long-term assets equal to AZN 45.9 billion. SOCAR’s current liabilities are AZN 20.6 billion, long-term liabilities are AZN 21,6 billion. In the reporting year, SOCAR's total capital and cash reserves amounted to AZN 21.9 billion and AZN 6.2 billion, respectively. The ratio of total liabilities to total assets was 66%.

It should be noted that the company's financial statements were published after obtaining the positive opinion by the international audit company Ernst & Young Holdings (CIS) B.V. You can view SOCAR's latest financial report here.