Azernews.Az

By Aynur Jafarova

Azerbaijan's state energy company SOCAR is not worried about the fluctuation of global oil prices, as the company has braced itself for the worst scenario by taking into account the lowest prices of oil wile forecasting its volume of revenues.

This remark was made by SOCAR President Rovnag Abdullayev on October 11.

He told the journalists that the expenditures and investment programs of SOCAR have been developed based on the lowest oil prices.

The average monthly price for Azerbaijani oil stood at $109 in January-September 2014. Experts forecast that if the price for Azerbaijani oil remains at the current level of $90-95 by late 2014, the average annual price will not fall below $100.

The oil prices remained high and fluctuated around $100 per barrel starting from 2011.

Nevertheless a dramatic decrease was recorded in oil prices in 2014, as the prices dropped by 20 percent from June to October. Some experts believe, this is the beginning of a new trend which will last more than a month.

So, currently, the oil prices tend to fall from $115 per barrel in June to $92 in early October.

However the discussions and voting in OPEC during its latest summit in November may have long-term effects on the formation of oil prices. If the organization's members agree to reduce the oil production, the prices may increase again (or at least remain at the current level). However, if they fail to reach an agreement, it is highly likely that the oil prices will continue to drop.

Remediation of contaminated lands at Bibi-Heybat

Abdullayev went on to add that SOCAR will complete the works on remediation and improvement of contaminated lands at the Bibi-Heybat onshore field by late 2014.

He said the works on remediation and improvement cover nearly 570 hectares of territory.

SOCAR had around 5,000 hectares of lands contaminated with oil in 2013. The company plans to complete the remediation of the oil contaminated lands in the Absheron peninsular by 2015.

The economically feasible wells are preserved in the process of remediation, while the operation inside old wells with small flow rate is suspended.

Bulgaria should make decision about place to receive Azerbaijani gas

Later, Abdullaye said Bulgaria should make a decision on a place for receiving Azerbaijani gas within the development of the second stage of Azerbaijan's giant Shah Deniz gas and condensate field in the Caspian Sea before the end of the construction of the Trans-Adriatic Pipeline (TAP).

He noted Bulgaria's largest natural gas distribution company Bulgargaz signed a contract to purchase 1 billion cubic meters of gas within the Shah Deniz project, and it should make a decision by late 2019 on the place where it will be receiving the gas - either on the border with Turkey or Italy.

Responding to a question regarding the Bulgarian side's willingness to obtain the gas before the start of main supplies, Abdullayev said, there should be technical ground, and the issue needs to be addressed seriously.

SOCAR and Bulgargaz inked a protocol of intentions and a Memorandum of Understanding in September 2014.

Previously, it was reported that Bulgaria is planning to start purchasing Azerbaijan's gas from 2016. It is expected that a final investment decision will be made in autumn 2014 to construct a gas grid interconnector between Greece and Bulgaria.