Successful development of oil and gas industry of the Republic of Azerbaijan as well as growing positions of State Oil Company of Azerbaijan Republic (SOCAR) in the global energy market reflects on scope of activities of SOCAR Marketing and Operations (SOCAR MO). President Ilham Aliyev’s policy on economical development of the country, his special attention to the oil and gas industry which is for that matter an integral part of our national economy are key factors which determine SOCAR MO’s current activities and future projects.

SOCAR MO is mainly engaged in exporting crude oil and oil products of Azerbaijan origin to the world market in accordance with the export strategy of SOCAR, arranging sales based on the country’s domestic demand for oil products, conducting marketing researches of the world energy market, studying new export markets, implementing coordination functions on ensuring control over delivery and acceptance of hydrocarbon volumes of Joint Ventures and Operating Companies producing crude oil at SOCAR fields.

We may confidently confirm nowadays benefits and effectiveness of an energy strategy established by our national leader Heydar Aliyev in early 1990s. Azeri-Chirag-Gunashli, Shah Deniz, South-Caucasian pipeline projects and Baku-Tbilisi-Ceyhan main export oil pipeline are only some of successful examples of the implementation of the above-mentioned strategy. Successful and consecutive implementation of the oil strategy of Azerbaijan enabled the country to reach leading positions in the world energy arena within a short period of time.

In 2012 and during 8 months of the current year SOCAR MO exported 25 million tons and 16.5 million tons of crude oil respectively within the frame of its export contracts. The more Azerbaijani crude oil is exported, the more it requires to further improve Department’s marketing policy and strategy in order to continue developing export operations and strengthening the position of Azerbaijani oil in global energy market. Therefore establishment of cooperation with new clients and large-scale refinery companies and introducing Azerbaijani origin crude oil in new potential energy markets are of a high importance.

During past years, SOCAR MO’s crude oil export network has been expanded to over than 30 countries, such as USA, Canada, Great Britain, India, China, Thailand, Taiwan, Malaysia, Singapore, Indonesia, South Korea, Australia, Vietnam, Japan, Mediterranean and North-West European countries. Export strategy has been strengthened by concluding long-term contracts with a number of companies.

Since December 2007 Geneva based SOCAR Trading SA is operating in the direction of strengthening SOCAR’s positions in the global energy market and transforming the company to one of the biggest players in this market. Operating for 6 years, the company expanded its activities by establishing offices in Singapore, Turkey (Istanbul), UAE (Dubai), Russia (Moscow), Egypt (Cairo), Vietnam and Nigeria (Lagos and Abuja).

SOCAR Trading SA has an important role in identifying potential clients for Azerbaijani crude oil which is exported within the framework of conditions set up under export contracts concluded with SOCAR MO. Over a period of its activities, SOCAR Trading SA succeeded to build fruitful business relations with multinational companies in energy market, such as Total, Exxon, ERG, Petroplus, IOC, Shell, Sunoco, OMV, ConocoPhillips, ENI, Saras, Irving, PTT, Chevron, etc.

Along with this, construction of the oil products storage terminal meeting modern standards with the capacity of 641,000 cubic meters started in the port of Fujairah of the United Arab Emirates in October 2010 in accordance with the agreement signed between SOCAR Trading SA and the Swiss Trading House Aurora Progress S.A. SOCAR Aurora Fujairah FZE Terminal started to operate in March 2012 (3 out of 20 commodity tanks with the capacity of 141,000 cubic meters are currently in operation). The Terminal will be capable to store various oil products of different companies as well as splitting large volumes of fuel into much smaller consignments and blending oil products in commodity tanks. Moreover, the terminal may be used as loading terminal (loading oil products from tanks into vessels and transporting them to other tanks located in the area of the port).

In the meantime, SOCAR Trading Singapore signed an agreement on storage of Azerbaijani oil in Yeosu Terminal in South Korea. The agreement will allow the company to strengthen its positions on Asian energy market by attracting new customers. 12 million barrels of crude oil has been supplied in this direction up to the present day.

Along with export of crude oil SOCAR MO is also engaged in realization of Azeri origin oil products on the international market. The Department is interested in broadening the export geography. Azerbaijani oil products are exported to numerous countries such as Turkey, Georgia, Italy, Egypt, Greece, Lebanon, Kazakhstan, Ukraine, Cyprus, Afghanistan, Malta, Algeria, Libya, Iraq, Romania, Israel, Tunisia, etc. One of the primary goals of SOCAR MO is to take an active part in global energy market which becomes more and more competitive and requires oil products of high quality to comply with modern standards. Thus, necessary surveys on recent trends are regularly conducted in order to adapt export policy and strategy to latest developments.

At the same time, with the participation of SOCAR MO, “SOCAR Overseas LLC” and “ST Overseas DMCC” Kazakh and Turkmen origin raw materials are being delivered to the Baku Oil Refinery named after Heydar Aliyev for further refining. The refined products are further being exported.

Establishment of SOCAR Energy Georgia in 2006 was one of the most important measures undertaken to increase efficiency of export operations and strengthen SOCAR’s positions in foreign markets. Since then the company is actively engaged in sale of Azerbaijani oil products in Georgian market which is one of the major consumers of Azerbaijani oil products. During eight months of the current year, SOCAR MO supplied to SOCAR Energy Georgia for realization  on the Georgian market 109.2 thousand tons of gasoil L-62 (D-01), 13.8 thousand tons of motor gasoline A-92, 29.5 thousand tons of jet fuel TS-1 and about 300 tons of fuel oil.

Moreover, since 2008 the company expanded its activities by establishing 110 gas stations in Georgia and this number is expected to reach 115 by the end of the current year.

SOCAR’s gas stations are operating not only in Georgia, but also in Ukraine (40), Romania (16), Switzerland (155) and in Azerbaijan (16).

Most part of oil products exported within the frame of contracts signed by SOCAR MO is supplied to the world markets through the SOCAR-owned Kulevi Terminal (Georgia) situated on the shore of the Black Sea. In January-August 2013, 519 thousand tons of gasoil L-62 (D-01) (82% of total export of gasoil) has been exported to the global energy market through Kulevi Terminal. 

Apart from export of crude oil and oil products of Azerbaijan origin to the world markets, SOCAR MO is also engaged in sale of oil products on the domestic market. The Department sells oil products produced at two SOCAR-owned oil refineries. The range of oil products sold domestically includes gasoline, gasoil, jet fuel, fuel oil, different types of lubricants and other oil products. SOCAR MO sells oil products through two oil bases and meets perfectly annual projections regarding local supply of oil products. This is reflected in the sale of oil products through the mentioned bases at the domestic market which rose by 4.9% over the reviewed period of 2013 compared with the first eight months of 2012.

SOCAR MO and its subdivisions were successfully certified for the second term in accordance with requirements of international health and safety (OHSAS 18001:2007), environmental protection (ISO 14001:2004) and quality management system (ISO 9001:2008) standards. Besides, international auditors positively evaluated the work performed in this direction. 

No accident, breakdown, fire and environmental pollution cases were registered.

Similar to other organizations of SOCAR, all operations related to accounting, scheduled reports and financial issues have been automated starting from 2008, introduction and development of the software was launched in accordance with SAP ERP system. Several modules and components of SAP ERP were introduced for accounting purposes according to International Financial Reporting Standards. Meanwhile, corresponding courses and trainings are also arranged to raise the qualification of employees.

SOCAR MO pays special attention to training of professional staff, especially, to the employment of young talented workers. In recent years, 10 graduates of SOCAR’s Study Abroad Program had opportunity to build their careers in SOCAR MO. In order to increase their proficiency, the employees of the Department along with attending the internationally recognized training courses, have possibility to get familiar with the operation principles of European sea ports, to which SOCAR’s crude oil and oil products are being loaded. At the moment, there are several young employees who have started their career at SOCAR MO currently working at SOCAR’s subsidiaries and representative offices abroad.