Azerbaijan Daily Newspapers

Azerbaijan to export 6m tonnes of Kazakh, Turkmen crude

Mr Abdullayev, as your Kazakh counterpart - the head of KazMunaiGas (KMG), Kairgeldy Kabyldin . - said earlier, the dates for the start of the Caspian Kazakh Transportation System have been put back because of a delay in the launch of the second phase of Kashagan field development. However, SOCAR opened its office in Astana because of the transport project. What will happen now that the postponement has been announced? In any case, we will be waiting for the start of the second phase of Kashagan development since the Caspian Kazakh Transportation System is geared to these volumes and, consequently, we will be geared towards implementation of this joint project. But despite the delay, nothing has stopped and work on the project is continuing along with the transportation of Kazakh oil from Tengiz (since Kashagan has not been launched yet) via the territory of Azerbaijan. The transportation system has not been built yet, but Kazakhstan’s Tengiz oil goes by tanker to our terminals in Baku and is then transferred to railway cisterns and taken by rail to the Black Sea ports. Turkmenistan’s crude is also shipped via this route. This year we expect up to 6m tonnes of Kazakh and Turkmen crude to be transported across the Caspian Sea to world markets through Azerbaijan. But so far our oil reaches the Black Sea only by rail, since three years ago Tengizchevroil refused to transport its crude via the Baku-Tbilisi-Ceyhan pipeline, despite an agreement signed by the heads of the two countries. The reason is dissatisfaction with tariffs for transit via BTC. At what stage are the negotiations on bringing Tengiz oil back to BTC? Negotiations between Tengizchevroil and the BTC pipeline shareholders are continuing. The tariff seems to have been agreed but I cannot specify what it is yet.

KMG subsidiary KazTransGaz faced a difficult financial situation with its Georgian partners in Tbilisi because of debts run up by the consumer, low tariffs for services and the high price of gas itself. Meanwhile, Azerbaijan is supplying crude oil to Georgia.

We supply gas to Georgia at a so-called social price under an intergovernmental agreement with them. We sell our gas at  lower than the market cost and in so doing are trying to help both the Kazakh and Georgian sides to settle the difficult financial situation that has arisen.

Mr Abdullayev, KMG has bought the oil refining concern Rompetrol in Romania which it now calls its outpost in Europe. Does SOCAR have plans to buy refining assets in Europe and other regions of the world?