Azerbaijan’s rising star

BAKU - Hürriyet Daily News

Energy Minister Yıldız ( L) and Abdullayev, the President of SOCAR.

It was towards the end of a joint press conference yesterday with Turkish Energy Minister Taner Yıldız, when Rövnag Abdullayev, the President of Azerbaijan’s national oil company SOCAR, was asked whether the Armenian occupation of one-fifth of the country was an obstacle to their energy projects.

“Not at all” he snapped, “They are not on our export routes. It’s their loss to continue the occupation and to be at odds with us and with Turkey. They should think about this as they lack prosperity and progress.”

Azerbaijan is indeed getting more prosperous day by day, thanks to the oil and gas produced and exported by SOCAR. That was mainly possible thanks to the flow of crude oil from a pipeline from the Caspian Sea shores of the landlocked Caucasus republic to Turkey’s Mediterranean Sea terminal of Ceyhan in 2006, the first hydrocarbon transport project not to be controlled by Russians, Iranians or Arabs from the region.

The change it brought to Azerbaijan over the past seven years is something physical on the streets and squares, buildings and vehicles and on the faces of people in Baku, perhaps it is that sweet smell of future, which brought the Davos-based World Economic Forum here for a dialogue for South Caucasus and Central Asia conference. Just as WEF had its first regional meeting in Istanbul 20 years ago, the Baku meeting could be another start for the region, said Klaus Scwabb, its head in the opening speech.

Azeri President İlham Aliyev, who is not very happy with a new wave of Wikileaks in recent days, considered here as a “plot,” is proud that he was able to maintain his country’s independence and sovereignty against Russia and Iran, and also make his country richer, too. Having seen 10 percent growth last years, the inflation is 1.2 percent and unemployment is 5.2 percent in the country.

Aliyev said in the opening panel that he knew it was not possible to maintain economic success with the export of oil and gas alone; “Energy projects do not generate jobs,” he believes. An oil and gas fund called SOFAZ takes some of the revenues of SOCAR in order to invest in other areas (Including Turkish Liras we learned in the press conference, Yıldız did not give any figure but said it “reflected the sisterhood between the two countries”). SOFAZ controlled some $40 billion and nearly 20 tons of gold in 2012.

Abdullayev, the head of country’s powerhouse and the host of Turkish journalists invited for the conference, said that the country gave a strategic importance to relations with Turkey. The amount of Azeri investments in Turkey will mount up to $17 billion this year, including a refinery in Turkey’s PETKİM petrochemical industries company, now owned by SOCAR, a terminal in the Western port of İzmir and the TANAP pipeline project to carry Azeri gas to European markets via Turkey.

Kenan Yılmaz, the head of Turkey operations of the company, underlined that the amount was the highest foreign investment in one lot ever to be made in Turkey. That is to be exceeded soon by the nuclear power plant projects by Russians in Turkey’s Mediterranean coast at Akkuyu, with a $22 billion investment, which raised eyebrows of the Americans. “We have made numerous calls to the U.S. as our strategic partner,” the Turkish energy minister said. “I cannot wait for them forever, I have to find energy from wherever possible.”