During five months Azerbaijan made only $64 million from Shah Deniz project

From January to May 2016 proceeds from sale of gas condensate from the Shah Deniz field to the State Oil Fund of Azerbaijan (SOFAZ) totaled $64 million.

A source from SOFAZ mentioned that since 2007 till June 1, 2016 profit from the Shah Deniz project totaled $2,506,000,000.

Table of SOFAZ’s incomes from the Shah Deniz field in 2016

In the beginning of every quarter very low profit of SOFAZ from the gas project is explained by the fact that the consortium has a possibility to show its financial indexes in details (income, profit and profit distribution). These data is used to correct payment of profit to the Azerbaijani side.

In 2015 SOFAZ’s income from the gas project totaled $323 million, while in 2014 - $523 million. From 2016 to 2018 gas profit of Azerbaijan from this project is forecast to be much less, because costs of the Shah Deniz-2 project will be high. This is bad on the one hand (in the coming three years gas incomes of the country will be minimal), on the other hand part of the Shah-Deniz-2 costs will be covered by the current income from the Shah-Deniz 1 project.

The contract for development of the Shah Deniz field was signed in Baku on June 4, 1996 and ratified by the Milli Mejlis on October 17, 1996. The project partners include BP (operator with 28.8%), Petronas (15.5%), SOCAR (16.7%), LUKoil (10%), NICO (10%) and TPAO (19%).—0—