Mineral industry of Azerbaijan

Last updated

As of 2017, Azerbaijan produced a range of metals and industrial minerals, including aluminum, bentonite, copper, gold, iodine, limestone, silver, and steel. [1]

Contents

Azerbaijan's importance as a world mineral producer, however, was based on its petroleum extracting industry. The country has been a significant oil producer for more than a century, but recent focus has been on developing offshore resources in the Caspian Sea. Production from the country’s Soviet-era fields are in decline, but since independence, foreign direct investment in offshore fields had revitalized the oil sector through the development of large-scale new projects and the refurbishment of older ones. In 2005, Azerbaijan had signed more than 20 major agreements to develop oilfields with approximately 30 companies from 15 countries. [2]

As of 2017, oil production has entered a decline, falling by 5.6% since 2016. Crude petroleum has declined in Azerbaijan since 2010, when the nation produced a record 50.8 MT. Production in 2017 was only 38.7 MT.

In 2005, Oil extraction and refining accounted for more than 75% of the value of industrial production. The oil extraction and refining sectors and the metallurgy and metal fabrication sectors employed more than 60,000 people in 2005. The country was becoming a major producer of oil, producing far more than it consumed, but its natural gas production in 2005 was still significantly below its consumption. The country was increasing its steel products production at the Baku Steel company, a privately owned company that produced steel products from steel scrap. [2]

Production

In 2005, production increased for practically all mineral commodities. Crude petroleum production increased by more than 43% compared with that of 2004. The country was developing its steel industry, although it is still on a small scale. [2]

Trade

Fuels accounted for 76% of the value of exports in 2005. The country’s major export was crude petroleum, almost all of which was sold on world markets rather than supplied to other CIS countries. Other mineral exports included petroleum refinery products and alumina. The country imported a variety of mineral commodities, including natural gas. [2]

Mineral resources

Azerbaijan’s major mineral wealth is its oil and gas reserves. Offshore hydrocarbon structures in the Caspian Sea accounted for most of the country’s oil and gas production. Azerbaijan’s proven crude oil reserves were estimated to range from 7 billion to 13 billion barrels (Gbbl) [or from about 950 million metric tons (Mt) to 1.8 billion metric tons (Gt)] based on various industry journals and Government sources. The State Oil Company of the Azerbaijan Republic (SOCAR) has estimated that proven reserves are 17.5 Gbbl (about 2.4 Gt) using the Soviet reserve classification system. This evaluation was not based on market economy criteria and may include resources that are not economically viable. Estimates of natural gas reserves also vary. According to the Oil & Gas Journal, Azerbaijan has proven natural gas reserves of roughly 30 trillion cubic feet (about 850 billion cubic meters, and BP p.l.c. estimates that the country has 48 trillion cubic feet (about 1.4 trillion cubic meters) of proven gas reserves. [2]

Outlook

Although some effort has been made to promote balanced mineral development of all the country’s mineral resources, the country’s economic development has depended primarily on the development of its large offshore oil and gas resources. These resources are expected to be the country’s chief source of revenue for the coming decades. [2]

In 2004, Azerbaijan exported approximately 211,000 barrels per day (33,500 m3/d) of oil. Exports are expected to more than double to 478,000 bbl/d (76,000 m3/d) in 2006 and to reach as high as 1.1 million barrels per day (170,000 m3/d) by 2008.

Azerbaijan was a net natural gas importer in 2005. The country is expected to become a significant gas exporter following the development of the Shah Deniz natural gas deposit, which is considered to be one of the world’s largest natural gas field discoveries of the past 20 years. According to BP (the project operator), Shah Deniz has potential recoverable reserves of about 15 trillion cubic feet (about 424 billion cubic meters) of natural gas and 600 million barrels (95,000,000 m3)—about 82 Mt] of condensate. Other industry and trade sources have estimated that the field contains as much as 35 trillion cubic feet (990 km3) of gas. The field is being developed by the Shah Deniz consortium, whose members include BP, LukAgip, National Iranian Oil Company (NICO) International, SOCAR, Statoil ASA of Norway, TotalFinaElf, and Türkiye Petrolleri Anonim Ortaklig (TPAO) of Turkey. [2]

In the first phase of the Shah Deniz field’s development, production of natural gas for export was expected to begin in late 2006. In the second phase, according to BP, the Shah Deniz project could produce an additional 1 trillion cubic feet (28 km3) per year of natural gas by as early as 2015. [2]

Although Azerbaijan lacks any infrastructure for the export of natural gas, efforts were underway to secure export routes and customers for gas deliveries beginning in 2006. The main conduit for Azerbaijan’s natural gas exports would be the South Caucasus Pipeline, also known as Baku-Tbilisi-Erzurum, which would run parallel to the Baku-T’bilisi-Ceyhan oil pipeline for most of its route before connecting to the Turkish gas pipeline network near the town of Horasan in Turkey. Pipeline construction began in late 2004 and was scheduled to be completed during the first quarter of 2007. The pipeline was expected to carry 233 billion cubic feet (6.6×109 m3) per year initially; this volume could be increased later to up to 700 billion cubic feet (2.0×1010 m3) per year with the future addition of compression stations. [2]

With the new pipeline infrastructure in place, Shah Deniz would be capable of producing approximately 350 billion cubic feet (9.9×109 m3) per year of natural gas by 2009. Supplies of natural gas from Shah Deniz and associated gas from the Azeri Chirag Gunashli (AGC) and the Bakhar-2 projects are expected to make Azerbaijan self-sufficient in natural gas and to result in significant export revenues. [2]

Related Research Articles

Sources include: Dow Jones (DJ), New York Times (NYT), Wall Street Journal (WSJ), and the Washington Post (WP).

<span class="mw-page-title-main">Shah Deniz gas field</span> Azerbaijani natural gas field

Shah Deniz gas field is the largest natural gas field in Azerbaijan. It is situated in the South Caspian Sea, off the coast of Azerbaijan, approximately 70 kilometres (43 mi) southeast of Baku, at a depth of 600 metres (2,000 ft). The field covers approximately 860 square kilometres (330 sq mi). Stretching out over 140 square kilometres, the reservoir is similar in size and shape to Manhattan Island.

<span class="mw-page-title-main">Petroleum industry in Azerbaijan</span> Aspect of Azerbaijani industry

The petroleum industry in Azerbaijan produces about 873,260 barrels (138,837 m3) of oil per day and 29 billion cubic meters of gas per year as of 2013. Azerbaijan is one of the birthplaces of the oil industry.

Azeri–Chirag–Gunashli or Azeri–Chirag–Deepwater Gunashli is a complex of oil fields in the Caspian Sea, about 120 kilometres (75 mi) off the coast of Azerbaijan. It consists of the Azeri and Chirag oil fields, and the deepwater portion of the Gunashli oil field. An overall estimate of the area of the development is 432.4 square kilometres (167.0 sq mi). It is developed by the Azerbaijan International Operating Company, a consortium of international oil companies, and operated by BP on behalf of the consortium. The ACG fields have estimated recoverable reserves of about 5 to 6 billion barrels of petroleum. Peak oil production of 835,000 barrels per day (132,800 m3/d) was reached in 2010, however by the first quarter of 2022 production had declined to 434,000 barrels per day (69,000 m3/d), or about one-half of peak value. As of 2021, ACG oil accounted for 95% of all Azerbaijani oil exports.

The South Pars/North Dome field is a natural-gas condensate field located in the Persian Gulf. It is by far the world's largest natural gas field, with ownership of the field shared between Iran and Qatar. According to the International Energy Agency (IEA), the field holds an estimated 1,800 trillion cubic feet of in-situ natural gas and some 50 billion barrels of natural gas condensates. On the list of natural gas fields it has almost as much recoverable reserves as all the other fields combined. It has significant geostrategic influence.

The National Oil Corporation is the national oil company of Libya. It dominates Libya's oil industry, along with a number of smaller subsidiaries, which combined account for around 70% the country's oil output. Of NOC's subsidiaries, the largest oil producer is the Waha Oil Company (WOC), followed by the Arabian Gulf Oil Company (Agoco), Zueitina Oil Company (ZOC), and Sirte Oil Company (SOC).

<span class="mw-page-title-main">Bouri Field</span> Libyan offshore oil field

The Bouri Offshore Field is part of Block NC-41, which is located 120 kilometers (75 mi) north of the Libyan coast in the Mediterranean Sea. It was first discovered in 1976 at a depth of 8,700 feet (2,700 m) and is estimated to contain 4.5 billion barrels (720,000,000 m3) in proven recoverable crude oil reserves and 3.5 trillion cubic feet (99 km3) of associated natural gas with an annual production potential of 6 billion m³. Bouri is considered the largest producing oilfield in the Mediterranean.

<span class="mw-page-title-main">Oil reserves in Ghana</span> Oil reserves located in Ghana

The petroleum industry of Ghana is regulated by the state-owned Ghana National Petroleum Corporation (GNPC) and administered by the state-owned Ghana Oil Company (GOIL).

<span class="mw-page-title-main">Natural gas in Iran</span> Overview of proven natural gas reserves in Iran

According to the Iran Petroleum Ministry, the proved natural gas reserves of Iran are about 1,201 trillion cubic feet (34.0 trillion cubic metres) or about 17.8% of world's total reserves, of which 33% are as associated gas and 67% is in non associated gas fields. It has the world's second largest reserves after Russia. As it takes approximately 5,850 cubic feet (166 m3) of gas to equal the energy content of 1-barrel (0.16 m3) of oil, Iran's gas reserves represent the equivalent of about 205 billion barrels (3.26×1010 m3) of oil.

<span class="mw-page-title-main">Sangachal Terminal</span> Azerbaijani natural gas and oil plant

The Sangachal Terminal is an industrial complex consisting of a natural gas processing plant and oil production plant, located on the coast of the Caspian Sea 45 kilometres (28 mi) south of Baku, Azerbaijan.

The mineral industry of Paraguay includes the production of cement, iron and steel, and petroleum derivatives. Paraguay has no known natural gas or oil reserves. To meet its crude oil and petroleum products demand, Paraguay relies completely on results of approximately 25,400 barrels per day (4,040 m3/d) (bbl/d). The mining sector contributes little to the country's economy, accounting for only 0.1% of its gross domestic production (GDP).

Sources include: Dow Jones (DJ), New York Times (NYT), Wall Street Journal (WSJ), and the Washington Post (WP).

<span class="mw-page-title-main">Natural gas in Qatar</span>

The natural gas in Qatar covers a large portion of the world supply of natural gas. According to the Oil & Gas Journal, as of January 1, 2011, reserves of natural gas in Qatar were measured at approximately 896 trillion cubic feet ; this measurement means that the state contains 14% of all known natural-gas reserves, as the world's third-largest reserves, behind Russia and Iran. The majority of Qatar's natural gas is located in the massive offshore North Field, which spans an area roughly equivalent to Qatar itself. A part of the world's largest non-associated, natural-gas field, the North Field, is a geological extension of Iran's South Pars / North Dome Gas-Condensate field, which holds an additional 450 trillion cubic feet of recoverable natural-gas reserves.

<span class="mw-page-title-main">Energy in Egypt</span>

This article describes the energy and electricity production, consumption and import in Egypt.

<span class="mw-page-title-main">Krishna Godavari Basin</span> Oilfield in India

Krishna Godavari Basin is a peri-cratonic passive margin basin in India. It is spread across more than 50,000 square kilometres in the Krishna River and Godavari River basins in Andhra Pradesh. The site is known for the D-6 block where Reliance Industries discovered the biggest natural gas reserves in India in 2003.

<span class="mw-page-title-main">Petroleum industry in Iran</span> Overview of the petroleum industry of Iran

Iran is an energy superpower and the petroleum industry in Iran plays an important part in it. In 2004, Iran produced 5.1 percent of the world's total crude oil, which generated revenues of US$25 billion to US$30 billion and was the country's primary source of foreign currency. At 2006 levels of production, oil proceeds represented about 18.7% of gross domestic product (GDP). However, the importance of the hydrocarbon sector to Iran's economy has been far greater. The oil and gas industry has been the engine of economic growth, directly affecting public development projects, the government's annual budget, and most foreign exchange sources.

The petroleum industry in Syria forms a major part of the economy of Syria. According to the International Monetary Fund, before the Syrian Civil War, oil sales for 2010 were projected to generate $3.2 billion for the Syrian government and accounted for 25.1% of the state's revenue.

According to the United States Energy Information Administration (EIA), Pakistan may have over 9 billion barrels (1.4×109 cubic metres) of petroleum oil and 105 trillion cubic feet (3.0 trillion cubic metres) in natural gas (including shale gas) reserves.

References

  1. ↑ Safirova, Elena (2023-10-11). "The Mineral Industry of Azerbaijan" (PDF).
  2. 1 2 3 4 5 6 7 8 9 10 Richard M. Levine and Glenn J. Wallace. "The Mineral Industries of the Commonwealth of Independent States". 2005 Minerals Yearbook. U.S. Geological Survey (December 2007). This article incorporates text from this U.S. government source, which is in the public domain.
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.