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September 20, 1994 changed Azerbaijan forever, playing a big role in nation’s development in completely unbelievable way.

This is the very day when young and newly independent Azerbaijan signed its first huge PSA deal with the world giants to develop largest oil and gas fields in the Caspian Sea.

The deal, named the “Contract of the Century”, encouraged developments in national oil and gas industry and positioned Azerbaijan among the focal points of the global energy market. The country began exporting its hydrocarbon resources to world markets, thus becoming an important supplier for global industry.

History shows that the country has been linked with oil for centuries, while the history of the world oil industry takes roots exactly from Azerbaijan.

The world's first oil well was drilled at the Bibi-Heybat field in 1847, and turned Baku into a center of world oil trade and made the country by far the frontrunner in the world's oil and gas industry.

The country attracted world oil investors, who gained millions on this industry. The Nobel brothers were the first to invest in oil extraction in Azerbaijan, making a great contribution to the development of the oil industry by establishing the Nobel Brothers Oil Extracting Partnership in 1873. The Rothschild Company and Shell led by Samuel Markus were also operated in Azerbaijan.

The country was the world's leading oil producer in 1901, when the output reached 11.5 million tons of oil. Moreover, the country produced 23.5 million tons of oil, which amounted to 71.4 percent of the Soviet Union's production in 1941, while the production guaranteed the victory of the Soviet Union in World War II and turned oil into an extremely important factor of the national economy.

Azerbaijan also boats being the world's first offshore oil producer. The discovery of the Neft Dashlari (Oil Rocks) field 40 km offshore and 90 km from Baku on November, 1949 made the country famous worldwide.

The giant Azeri, Chirag, Kapaz, and Gunashli fields were discovered at the depth of 80 to 350 meters in the late 1970s and early 1980s.

The very ACG fields impacted the further development of oil industry and the economy of Azerbaijan as a whole.

The “Contract of the Century” was a triumphant result of the policy based on the oil strategy pursued by national leader Heydar Aliyev, paving the way for bolstering the country's geo-political standing and economic integration.

With signing the deal, Azerbaijan opened its doors to foreign investments and was able to prove the confidence of the world's leading countries in it, encouraging major companies to invest in the country and increase the prestige of Azerbaijan in the international arena.

Major energy projects implemented in the Azerbaijan section of the Caspian have turned the region into one of the important world’s hydrocarbon provinces.

Over the past 23 years, Azerbaijan witnessed many significant events– from discovering and developing new offshore and onshore perspective fields to putting them into operation; from considering several export routes to actually transporting Azerbaijan oil and gas to international markets; from building the local infrastructure to developing a high quality oil and gas industry; from an oil-rich country in East into a major player in the global energy market.

Few days earlier BP and its partners in Azerbaijan's giant ACG oil production complex agreed to extend the production sharing contract by 25 years to 2049 and to increase the stake of state-owned SOCAR, reducing the size of their own share.

The extension of the production sharing contract, which was to expire in 2024, reflects the growing financial and technological potential of Azerbaijan and SOCAR. And the deal will allow all the participating companies to further generating value from the asset for many decades to come.

The Contract of the 21st Century is perhaps an even more important milestone in the history of Azerbaijan as it ensures that over the next three decades the country and its partners will continue to work for unlocking the long-term development potential of the ACG through new investments, new technologies and new joint efforts.

Today, hundreds of thousands of Azerbaijani gas and oil industry workers do their best to make sure that millions of people have everything they need in modern life – gas, heat, electricity and fuel, while the national economy receives the needed boost.

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