Azerbaijan’s oil exports declined, although revenues from its sales rose in January-February backed by higher oil prices on the world markets. Gas export surged in the first two months of the year as the country continued commercial natural gas exports to Europe from its major Shah Deniz II field.
The country reduced oil exports by 13.9 percent year-on-year to 4.9 million tonnes and increased exports of natural gas by 19.4 percent to 3.96 billion cubic metres (bcm), State Customs Committee said.
Revenues from oil sales rose by 44 percent year-on-year to $2.943 billion.
ACG is the largest oil field block in Azerbaijan developed by a BP-led international consortium. The first production sharing agreement for developing the block was signed on September 20, 1994, while a new deal on the joint exploitation of these fields and production sharing was reached on September 14, 2017. The agreement provides for the development of the areas by the end of 2049.
Seventeen countries purchased oil from Azerbaijan in January-February. Italy imported 43.3 percent of oil export’s total volume. Israel and Ukraine were also top importers of oil from Azerbaijan.
The country uses the Baku-Tbilisi-Ceyhan (BTC) pipeline via Georgia and Turkey to export oil from the ACG. It also exports oil through the Baku-Novorossiisk pipeline via Russia, the Baku-Supsa pipeline via Georgia and by rail in Georgia.
As for natural gas, Azerbaijan mainly produces it at its major offshore Shah Deniz field. The share of gas exports in Azerbaijan’s total exports was 41.7 percent in the first two months of this year.
The opening of the Southern Gas Corridor in December 2020 allowed Azerbaijan to start gas exports to Europe, giving the ex-Soviet country the means to increase its share in the market, until now dominated by Russia.
The BP-led consortium, which develops the project, has been pumping gas from the offshore field’s first phase since 2006, delivering more than 10 bcm a year of gas to Azerbaijan, Georgia and Turkey. The second phase started output in 2018, adding 16 billion cubic metres (bcm) of gas production capacity at its peak to bring total capacity to 26 bcm.
Oil and gas condensate production fell by 6.2 percent year-on-year to 5.465 million tonnes in January-February, while natural gas output rose by 12.4 percent to 7.684 bcm.
The volume of marketable oil was 5.448 million tonnes, 6.4 percent down from January-February 2021. The production of commercial gas rose to 6.013 bcm, 17.8 percent up from the same period a year ago.
In 2021, Azerbaijan exported 28.1 million tonnes of oil and around 19 bcm of gas. The country earned $13.9 billion from oil sales and $6.5 billion from sales of natural gas.