Construction of Carbamide Plant in Georgia depends on Shah Deniz 2
By Fatma Babayeva
Today, Azerbaijan’s state owned energy company SOCAR has no plans to realize the construction of a carbamide plant in neighboring Georgia.
Currently, it is not planned to build the carbamide plant in Georgia, Georgian Deputy Energy Minister Mariam Valishvili said while talking to Trend on May 20.
Earlier, SOCAR was planning to build the plant in the Kulevi free industrial zone in Georgia. However, the construction of the plant was stopped due to the change in the energy market conditions in 2015.
It was originally planned to supply 500 million cubic meters of gas a year to the plant, said Valishvili.
Pointing to increasing consumption of gas in Georgia, Valishvili said there are no free volumes for the carbamide plant. “We have no gas, and that is why we have decided that construction of the plant makes no sense,” she said
Nevertheless, Valishvili believes it will be possible to resume the talks on the carbamide plant construction in 2019-2020 when the development of the second phase of Azerbaijan's Shah Deniz gas field starts and additional volumes of gas are supplied to the market.
“Then it will be possible to review the project taking into account whether the supplies in necessary volumes will be possible and what the price for gas will be," said the deputy minister. "But for now it is out of question."
Valishvili further noted that gas should be delivered at a special discounted price to the carbamide plant for its profitability.
In case if the carbamide plant is built, majority of its output will be exported as there is no need for great amount of carbamide in the domestic market of Georgia, stated Deputy Minister.
The Georgian government will unlikely invest in this project on its own, since it does not have such an opportunity, she added. In addition, it is not reasonable for Georgia to make investment in a project designed for the foreign market.
SOCAR expands capacity of oil terminal in Georgia
SOCAR will expand the capacity of the Kulevi Black Sea oil terminal in Georgia from current 320,000 cubic meters to 380,000 cubic meters, said the source in SOCAR.
The terminal in Georgia's Kulevi was commissioned in May 2008. The oil transshipment started in June of the same year.
The total capacity of the terminal is 10 million tons of bulk-oil cargo per year, three million tons of oil, three million tons of diesel fuel and four million tons of fuel oil.
The expansion of the Kulevi terminal is connected with the modernization of the Baku Oil Refinery named after Heydar Aliyev which production capacity will grow from 6 million tons to 7.5 million tons per year.
The increase in oil products will naturally lead to building up export, said the source, adding that most part of oil products is transshipped through Kulevi terminal, so its expansion is a natural requirement.
Now, the terminal's storage tank’s capacity amounts to 320,000 cubic meters. SOCAR plans to increase it up to 380,000 cubic meters, told the source.
The expansion project has already started and is likely to be completed next year, according to the source. There is demand for these capacities, and it will be ensured at the expense of both Azerbaijani and transit volumes of oil products.
SOCAR will try to involve third parties, customers as well, so that they use the Kulevi terminal for transshipment, the source said.
SOCAR is involved in exploring oil and gas fields, producing, processing, and transporting oil, gas, and gas condensate, marketing petroleum and petrochemical products in domestic and international markets, as well as, supplying natural gas to industry and the public in Azerbaijan.
Three production divisions, one oil refinery and one gas processing plant, a deep water platform fabrication yard, two trusts, one institution, and 23 subdivisions are operating as corporate entities under SOCAR.
In accordance with the statistics, 5.45 million tons of oil products were produced in Azerbaijan during 2015 compared to 5.31 million tons of oil products manufactured during 2014.
In addition, 1.45 million tons of oil products were produced during the first quarter of 2016 compared to 1.34 million tons of oil products produced during the respective period of 2015.
Currently, SOCAR implements modernization projects of its refineries in Azerbaijan.
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Fatma Babayeva is AzerNews’ staff journalist, follow her on Twitter: @Fatma_Babayeva
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