Azerbaijan, host of the upcoming UN COP29 climate summit, is a petrostate sandwiched between Russia and Iran.
an ancient history
The name Azerbaijan comes from the Persian “azer”, or “sacred fire”, which comes from the temples of the ancient religion of Zoroastrianism, which were fueled by gas or crude oil that came naturally from the ground.
In the late 13th century, the Venetian explorer and writer Marco Polo reported seeing a gushing “fountain of oil” while traveling along the Silk Road in the Caucasus.
Today, near the capital Baku, the Zoroastrian Ateshgah temple continues to burn with a fire fueled by methane gas piped from a nearby farm. Earlier gas used to come out from cracks in the ground.
source of oil extraction
The country is historically one of the strongholds of modern oil extraction: even before drilling began in the United States, a well was drilled near Baku in 1846, which was soon surrounded by derricks.
Sweden’s Robert and Ludvig Nobel – brothers of Alfred, in whose name the Nobel Prizes are awarded – were among the first to invest in Azeri oil.
He purchased a refinery and oil fields in 1876, then founded the Branobel Company which became the world’s largest company before being nationalized in 1920 when Azerbaijan came under Soviet control.
It was estimated that more than half of world oil production in 1900 came from the Absheron Peninsula on the Caspian Sea on which Baku is located.
an oil-gas republic
The Republic of Azerbaijan, which became independent after the collapse of the Soviet Union in 1991, derives most of its wealth from oil and natural gas, which today comes primarily from offshore deposits in the Caspian Sea.
According to the International Energy Agency (IEA) and the US State Department, hydrocarbons represent 90 percent of the country’s exports, half of state income, and a third of GDP.
The IEA rates Azerbaijan as a “major” producer and exporter of natural gas and oil, with 32.7 million tonnes of crude oil and 35 billion cubic meters of natural gas produced in 2022, more than two-thirds of which is exported. Was done.
As of 2022 data, the country is among the 20 largest net exporters for oil and the 12th largest exporter for gas.
The deepwater Azeri-Chirag-Gunashli (ACG) oil field complex, discovered in the 1970s about 100 kilometers (62 mi) east of Baku, is the country’s main source of oil.
The site, operated by British company BP in cooperation with state-owned Socor, is responsible for more than half of the national production of crude, according to BP’s operational data for the first quarter of 2024.
bet on gas
While Azerbaijan’s oil production has been on the decline since peaking in 2010, natural gas production is increasing.
A member of OPEC+, an expanded version of the Organization of the Petroleum Exporting Countries, it defends gas as a transition energy as nations seek to cut carbon emissions, and plans to cut its production by about a third over the next decade. Are planning to increase.
Baku hopes to take advantage of a decline in Russian gas exports hit by international sanctions following the war in Ukraine to supply gas to Europe via the Southern Gas Corridor network of pipelines linking Azerbaijan to Italy and crossing Georgia and Turkey. To become a preferred supplier.
The main gas field, Shah Deniz, was discovered in 1999 in the Caspian Sea about 70 kilometers south of Baku and is one of the largest natural gas sites in the world.
Operated by BP, it provides more than two-thirds of national production, according to the firm.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
