World Bank eyes funding for Azerigaz methane leak reduction initiative

The World Bank is considering providing support for a gas leak detection project in Azerbaijan titled the “Azerigas Gas Leak Detection and Repair Facility,” Azernews reports, citing the Bank.

The project aims to reduce methane emissions caused by leaks in the gas distribution network operated by Azerigaz, while also strengthening the company’s capacity in asset management.

The proposed financing volume of the project is $15 million, with approval scheduled for April 23, 2026.

Under the project, a results-based financing mechanism will be established to support the detection and repair of gas leaks in Azerigaz’s distribution system. This mechanism will be launched using an initial grant from the Global Flaring and Methane Reduction Partnership (GFMR) Trust Fund.

SOCAR will act as the grant recipient and owner of the grant accounts, while Azerigaz will be the sole beneficiary and the implementing agency responsible for the project’s day-to-day execution and management. Funds for agreed leak detection and repair activities aimed at the phased reduction of methane emissions will be channeled from SOCAR to Azerigaz.

The project will build on Azerigaz’s pilot program that established a baseline for gas leaks in Baku. Repair works will be proposed and implemented by Azerigaz in line with pre-agreed eligibility criteria. Measures will be prioritized based on cost, complexity, impact, and other relevant factors to ensure maximum emissions reduction per dollar spent.

In addition, both in the initial phase and in subsequent stages, GFMR funding will be used to enhance Azerigaz’s capacity in emissions monitoring, reporting, and verification in accordance with the OGMP 2.0 standard.