Azerbaijan cuts oil production in line with OPEC+ committement

By Azernews

By Ayya Almhammad

As of May 1, Azerbaijan reduced its oil production in line with its OPEC+ commitments, head of the press service of the Ministry of Energy Zamina Aliyeva told local media.

Aliyeva said that oil production reduction quotas are proportionally distributed between oil and gas production departments of SOCAR and oil producers operating within the framework of agreements on the distribution of production and similar oil contracts.

In May-June 2020, SOCAR will reduce production by 17,000 bpd, up to 100,000 bpd, excluding condensate. Azerbaijan International Operating Company (AMOC) will reduce production by 76,000 bpd, from Azeri- Chirag- Gunashli block, while the rest of the operating companies - by 3,000 bpd.

In July-December 2020, SOCAR will increase production from 100,000 bpd to 105,000 bpd, from 2021 - to 111,000 bpd.

AMOC will increase production by 27,000 bpd in July-December 2020 and by another 26,000 bpd from 2021. Thus, the daily production of oil from the ACG block in 2021 is projected at 487,000 bpd.

The other operating companies will increase production by 1,000 bpd in July-December 2020 and by another 1,000 bpd from 2021.

Thus, within the framework of OPEC+ commitments, Azerbaijan's oil production in May-December 2020 will decrease by 17.4 million barrels, to 141.8 million barrels. In 2021, oil production in Azerbaijan is projected at 226.3 million barrels.

As reported earlier, in April 2020, OPEC and non-OPEC countries entered into agreement on reduction of daily oil production in three stages from May 1,2020 to April 2022. In the first stage (May-June 2020) the decrease within the OPEC+ framework will amount to 9.7 million bpd.

Note, for Azerbaijan oil production rate from October 2018 was 718,000 bpd. Within the framework of the agreement, Azerbaijan pledged to reduce oil production in May-June 2020  by 23 percent  i.e. by 164,000 bpd, to 554,000 bpd, in July-December 2020 - by 18 percent or 131,000 bpd, to 587,000 bpd, in the period from January 2021 to April 2022 - by 14 percent or 98,000 bpd, to 620,000 bpd.