The State Oil Company of Azerbaijan Republic ( az, Azərbaycan Respublikası Dövlət Neft Şirkəti), largely known as SOCAR is fully
state-owned national oil and gas company headquartered in
Baku,
Azerbaijan
Azerbaijan (, ; az, Azərbaycan ), officially the Republic of Azerbaijan, , also sometimes officially called the Azerbaijan Republic is a transcontinental country located at the boundary of Eastern Europe and Western Asia. It is a part of t ...
. The company produces
oil
An oil is any nonpolar chemical substance that is composed primarily of hydrocarbons and is hydrophobic (does not mix with water) & lipophilic (mixes with other oils). Oils are usually flammable and surface active. Most oils are unsaturated ...
and
natural gas
Natural gas (also called fossil gas or simply gas) is a naturally occurring mixture of gaseous hydrocarbons consisting primarily of methane in addition to various smaller amounts of other higher alkanes. Low levels of trace gases like carbo ...
from onshore and offshore fields in the Azerbaijani segment of the
Caspian Sea
The Caspian Sea is the world's largest inland body of water, often described as the world's largest lake or a full-fledged sea. An endorheic basin, it lies between Europe and Asia; east of the Caucasus, west of the broad steppe of Central Asia ...
. It operates the country's only oil refinery, one gas processing plant and runs several oil and gas export
pipeline
Pipeline may refer to:
Electronics, computers and computing
* Pipeline (computing), a chain of data-processing stages or a CPU optimization found on
** Instruction pipelining, a technique for implementing instruction-level parallelism within a s ...
s throughout the country. It owns fuel filling station networks under the ''SOCAR'' brand in
Azerbaijan
Azerbaijan (, ; az, Azərbaycan ), officially the Republic of Azerbaijan, , also sometimes officially called the Azerbaijan Republic is a transcontinental country located at the boundary of Eastern Europe and Western Asia. It is a part of t ...
,
Turkey
Turkey ( tr, Türkiye ), officially the Republic of Türkiye ( tr, Türkiye Cumhuriyeti, links=no ), is a transcontinental country located mainly on the Anatolian Peninsula in Western Asia, with a small portion on the Balkan Peninsula in ...
,
Georgia
Georgia most commonly refers to:
* Georgia (country), a country in the Caucasus region of Eurasia
* Georgia (U.S. state), a state in the Southeast United States
Georgia may also refer to:
Places
Historical states and entities
* Related to the ...
,
Ukraine
Ukraine ( uk, Україна, Ukraïna, ) is a country in Eastern Europe. It is the second-largest European country after Russia, which it borders to the east and northeast. Ukraine covers approximately . Prior to the ongoing Russian inv ...
,
Romania
Romania ( ; ro, România ) is a country located at the crossroads of Central, Eastern, and Southeastern Europe. It borders Bulgaria to the south, Ukraine to the north, Hungary to the west, Serbia to the southwest, Moldova to the east, and ...
and
Switzerland.
SOCAR is a major source of income for the authoritarian regime in Azerbaijan.
The company is run in an opaque manner, as it has complex webs of contracts and middlemen that have led to the enrichment of the country's ruling elites.
History
Soviet era
Azneft, a business that integrated the Azerbaijani oil industry was created after the
Bolshevik Revolution
The October Revolution,. officially known as the Great October Socialist Revolution. in the Soviet Union, also known as the Bolshevik Revolution, was a revolution in Russia led by the Bolshevik Party of Vladimir Lenin that was a key moment ...
through the
nationalization of the
Azerbaijan
Azerbaijan (, ; az, Azərbaycan ), officially the Republic of Azerbaijan, , also sometimes officially called the Azerbaijan Republic is a transcontinental country located at the boundary of Eastern Europe and Western Asia. It is a part of t ...
i oil industry. It was subordinate to different organizations in the former
Soviet Union
The Soviet Union,. officially the Union of Soviet Socialist Republics. (USSR),. was a List of former transcontinental countries#Since 1700, transcontinental country that spanned much of Eurasia from 1922 to 1991. A flagship communist state, ...
and the
Azerbaijan Soviet Socialist Republic, depending on its organizations' characteristics at different times and was known as Azerneftkomite, Azerneftkombinat (later divided into the Azerneft, Azerneftzavodlar and Azerneftmashingayirma syndicates), and Azerneftchikharma syndicates, and so forth. In 1954–1959, the
Ministry of the Oil Industry of the Azerbaijan SSR and in 1965–1970, the Ministry of Oil Production Industry of the Azerbaijan SSR were established on the basis of Azerneft. In August 1970, it was renamed back to ''Azerneft''.
Post-independence
As the Republic of Azerbaijan gained independence, Azerineft State Concern was established on 3 December 1991. The State Oil Company of the Azerbaijan Republic (SOCAR) was created on 13 September 1992 by the merger of Azerbaijan's two state oil companies, Azerineft State Concern and Azerneftkimiya Production Association according to the decree of then president
Abulfaz Elchibey.
In 1994, the Onshore and Offshore Oil and Gas Production Association were established as part of the State Oil Company. In 2003, the Onshore and Offshore Oil and Gas Production Association were merged to form the Azneft Production Union.
In July 21, 2022 Rovshan Najaf was appointed as the President of SOCAR as based on the decree issued by Ilham Aliyev, the President of the Republic of Azerbaijan. In December 2005, the former head of the Baku Oil Refinery and a member of the Azerbaijani parliament,
Rovnag Abdullayev, was appointed President of SOCAR. He replaced
Natig Aliyev
Natiq Aghaami oglu Aliyev ( az, Natiq Ağaəmi oğlu Əliyev; November 23, 1947 – June 9, 2017) was an Azerbaijani politician. He served as the president of the State Oil Company of Azerbaijan Republic and was the Minister of Industry and Ene ...
, who was named Azerbaijan's
Minister of Industry and Energy.
The Azerbaijan government adopted for a strategy in the 1990s to rev up oil exploration and deplete existing oil wells, with immediate economic gains. Victor Menaldo writes that recently independent Azerbaijan found "itself in a fragile and desperate situation after a war against Armenia, a huge banking crisis, and an economic collapse" and that "the government was left with no other option than to rev up oil exploration and hasten the depletion of extant wells, despite the fact that oil discoveries had peaked."
Menaldo wrote in 2016, "the days in which the Azerbaijani state can offset its underlying weakness by drilling its way out of trouble are numbered... Whether Azerbaijan can now transition to a more diversified economy is an open question."
Thomas de Waal wrote in 2018, "Azerbaijan’s economy showed classic symptoms of “Dutch Disease,” the condition whereby heavy reliance on the export of one product—usually oil or gas—weakens the rest of the economy."
According to De Waal, the oil wealth had enriched political and economic elites in Azerbaijan, along with underspending of the oil riches on long-term development.
Operations
Upstream operations
SOCAR's activities are exploration, preparation, exploitation of
onshore and
offshore oil and gas fields, transportation, processing, refining and sale of oil, gas, condensate and other related products.
[ SOCAR's exploration activities cover the prospective offshore fields in the Azerbaijani sector of the Caspian Sea. The current largest fields being explored are Shafag-Asiman, which is explored with BP, and Absheron natural gas fields which is being explored together with BP and ]TotalEnergies
TotalEnergies SE is a French multinational integrated energy and petroleum company founded in 1924 and one of the seven supermajor oil companies. Its businesses cover the entire oil and gas chain, from crude oil and natural gas exploration and ...
respectively.
In 2010, SOCAR and BP signed a new production sharing agreement regarding Shafag-Asiman. In 2014, SOCAR and BP signed a joint exploration and development over the Shallow Water Absheron Peninsula. SOCAR has explored the Umid and Bulla Deniz gas fields. In 2017, SOCAR and a consortium led by BP signed a letter of intent for future development of the Azer-Chirag-Gunashli field. They signed a $6 billion contract regarding the Azeri Central East (ACE) platform on the Azeri-Chirag-Gunashli field.
In 2016, SOCAR produced of gas. Azerbaijan has 57 oil fields, 18 of which are offshore, in the Azerbaijani sector of the Caspian Sea
The Caspian Sea is the world's largest inland body of water, often described as the world's largest lake or a full-fledged sea. An endorheic basin, it lies between Europe and Asia; east of the Caucasus, west of the broad steppe of Central Asia ...
. The essential part of the company's revenue comes from the giant ACG oil field complex and Shah Deniz gas field
Shah Deniz gas field ( az, Şahdəniz) is the largest natural gas field in Azerbaijan. It is situated in the South Caspian Sea, off the coast of Azerbaijan, approximately southeast of Baku, at a depth of . The field covers approximately . Stretch ...
. In September 1994, SOCAR entered into a Production sharing agreement Production sharing agreements (PSAs) or production sharing contracts (PSCs) are a common type of contract signed between a government and a resource extraction company (or group of companies) concerning how much of the resource (usually oil) extra ...
(PSA) with the foreign oil companies led by BP for the 30-year development of the ACG oil field which was later known as the ''Contract of the Century''. Two years later Shah Deniz PSA was signed. As of 2014 SOCAR holds 11.6% of the ACG shares and 16.7% of the Shah Deniz shares. Moreover, SOCAR operates a number of onshore fields on its own which is the main source of the domestic supply.
In 2013, 43.48 million tons (318.74 million barrels) of oil was produced in Azerbaijan, of which 8.31 million tons (60.95 million barrels) belong to SOCAR. In the same period, Azerbaijan's natural gas production reached record high of 29.46 billion cubic metre of which SOCAR shares constitute 7.14 billion cubic metre of it.
Pipeline operations
SOCAR has a share in two parallel-running major export pipelines of the country; Baku-Tbilisi-Ceyhan pipeline (BTC) and South Caucasus Pipeline
The South Caucasus Pipeline (also known as Baku–Tbilisi–Erzurum Pipeline, BTE pipeline, or Shah Deniz Pipeline) is a natural gas pipeline from the Shah Deniz gas field in the Azerbaijan sector of the Caspian Sea to Turkey. It runs parallel t ...
(SCP).[
]
The pipelines deliver the ACG and Shah Deniz
Shah Deniz gas field ( az, Şahdəniz) is the largest natural gas field in Azerbaijan. It is situated in the South Caspian Sea, off the coast of Azerbaijan, approximately southeast of Baku, at a depth of . The field covers approximately . Stretch ...
hydrocarbons from Sangachal Terminal
The Sangachal Terminal is an industrial complex consisting of a natural gas processing plant and oil production plant, located on the coast of the Caspian Sea south of Baku, Azerbaijan.
History
Construction of the terminal began in 1996 with t ...
located in 45 km south of Baku to Turkey and Europe. They pass through the borders of three countries: Azerbaijan, Georgia and Turkey. The share of SOCAR in the BTC and SCP is 25% and 16.7% respectively. In addition, SOCAR is the major shareholder with 58% ownership in the Trans-Anatolian gas pipeline
The Trans-Anatolian Natural Gas Pipeline (TANAP; az, Trans-Anadolu Təbii Qaz Boru Kəməri, tr, Trans-Anadolu Doğalgaz Boru Hattı) is a natural gas pipeline in Turkey. It is the central part of the Southern Gas Corridor, which connects the ...
(TANAP) and with 20% ownership in Trans Adriatic Pipeline
Trans Adriatic Pipeline (TAP) ( sq, Gazsjellësi Trans-Adriatik, el, Διαδριατικός Αγωγός Φυσικού Αερίου - ''Diadriatikós Agogós Fysikoú Aeríou'', it, Gasdotto Trans-Adriatico) is a natural gas pipeline p ...
(TAP) which are meant to transmit some 16 bcma of gas produced from the second phase of Shah Deniz gas field
Shah Deniz gas field ( az, Şahdəniz) is the largest natural gas field in Azerbaijan. It is situated in the South Caspian Sea, off the coast of Azerbaijan, approximately southeast of Baku, at a depth of . The field covers approximately . Stretch ...
with 10 bcma of that going to Europe and 6 bcma to Turkey. The TAP is seen as a competitor to Russia's South Stream
South Stream (russian: Южный поток, Yuzhnyy potok; bg, Южен поток, Yuzhen potok; sr, / ; sl, Južni tok; hu, Déli Áramlat; it, Flusso Meridionale) was a canceled pipeline project to transport natural gas of the Russia ...
because of diversification of gas supplies to Europe. In February 2021, SOCAR's vice president for investment and marketing, Elshad Nasirov, stated that 20% of TANAP would be able to transport hydrogen
Hydrogen is the chemical element with the symbol H and atomic number 1. Hydrogen is the lightest element. At standard conditions hydrogen is a gas of diatomic molecules having the formula . It is colorless, odorless, tasteless, non-toxic ...
to Europe without additional investments.
The company has stakes in the relatively low-capacity Baku-Supsa Pipeline and Baku-Novorossiysk Pipeline. The Azerbaijani part of the Baku-Novorossiysk Pipeline is operated by SOCAR, whereas Baku-Supsa Pipeline's operator is BP. Moreover, SOCAR operates Dubendi Oil Terminal in Azerbaijan and Kulevi Oil Terminal in Georgia which are important for transportation and export.
Refining operations
SOCAR has two oil refineries and one gas processing plant. Azerneftyagh Oil Refinery specializes in the production of fuels and oils, producing gasoline, kerosene and diesel distillates, various oils (industrial, motor, transformer etc.) and asphalt. All fuel distillates produced there are sent to Heydar Aliyev Baku Oil Refinery for redistillation. The refinery processes 21 out of 24 grades of the Azerbaijani crude. It meets the country's entire demand for petroleum products and 45% of its petroleum products are exported. The Gas Processing Plant produces processed gas, liquified gas and natural gasoline. In 2010, the plant produced 4 bcm of processed gas, 24,800 tons of liquefied gas and 26,700 tons of natural gasoline.
Retail station operations
The first fuel station of the company under the brand name ''SOCAR'' was opened in neighboring Georgia
Georgia most commonly refers to:
* Georgia (country), a country in the Caucasus region of Eurasia
* Georgia (U.S. state), a state in the Southeast United States
Georgia may also refer to:
Places
Historical states and entities
* Related to the ...
in 2008, before any in its home country. The fuel stations in Georgia are operated by the subsidiary of the company SOCAR Georgia Petroleum. As of 2014 there were currently more than 110 filling stations in Georgia making it the largest retail fuel station network of SOCAR. In Azerbaijan, the company operates a few (less than any other country where it operates) filling stations under the brand name ''SOCAR'' since 2010. It is the third largest network of retail stations in Azerbaijan after Azpetrol
Azpetrol Ltd. LLC is an Azerbaijani oil and gas company, with 88 filling stations in the country.
Overview
The principal activity of Azpetrol, which opened its first filling station in July 1997 in Baku, is the retail and wholesale of fuel th ...
and Lukoil. In 2011, the first retail station of SOCAR was opened in Ukraine
Ukraine ( uk, Україна, Ukraïna, ) is a country in Eastern Europe. It is the second-largest European country after Russia, which it borders to the east and northeast. Ukraine covers approximately . Prior to the ongoing Russian inv ...
. In October 2014 the number of the SOCAR stations in Ukraine reached 40.
In 2011, the company entered into the Romania
Romania ( ; ro, România ) is a country located at the crossroads of Central, Eastern, and Southeastern Europe. It borders Bulgaria to the south, Ukraine to the north, Hungary to the west, Serbia to the southwest, Moldova to the east, and ...
n market acquiring initially 90% and at a later stage the rest 10% of the stake in Romtranspetrol. In September 2014, SOCAR launched its 30th filling station in Romania
Romania ( ; ro, România ) is a country located at the crossroads of Central, Eastern, and Southeastern Europe. It borders Bulgaria to the south, Ukraine to the north, Hungary to the west, Serbia to the southwest, Moldova to the east, and ...
. In November 2011, SOCAR bought ExxonMobil's Swiss subsidiary Esso Schweiz for an undisclosed amount. Along with the acquisition SOCAR became the owner of a network of more than 160 filling stations operating under the brand name ''Esso'' across the country. The first SOCAR premium fueling station in Switzerland after the rebranding was opened in September 2012 in Zurich. All the operations in Switzerland are managed and led by SOCAR Energy Switzerland.
Other operations
In December 2007, SOCAR Trading was incorporated and became the marketing division of SOCAR. Headquartered in Geneva
, neighboring_municipalities= Carouge, Chêne-Bougeries, Cologny, Lancy, Grand-Saconnex, Pregny-Chambésy, Vernier, Veyrier
, website = https://www.geneve.ch/
Geneva ( ; french: Genève ) frp, Genèva ; german: link=no, Genf ; it, Ginevr ...
, SOCAR Trading offers ultra-low-sulfur-diesel, liquefied petroleum gas and markets SOCAR crude oil export volumes from Ceyhan
Ceyhan () is a city and a district in the Adana Province, in southern Turkey, east of Adana. With a population of over 157,000, it is the largest district of the province, outside the city of Adana. Ceyhan is the transportation hub for Middle Ea ...
, trades third party crude and oil products and assists SOCAR with international investments in logistics, downstream and sales. Alongside its field of activity in marketing and sales, SOCAR Trading assists SOCAR in expanding SOCAR's assets as well.
Azerigaz Production Union (PU) has been carrying out transportation, distribution and sale of natural gas in the territory of the Republic of Azerbaijan. The Union has also been ensuring transportation of natural gas produced by SOCAR to the Islamic Republic of Iran
Iran, officially the Islamic Republic of Iran, and also called Persia, is a country located in Western Asia. It is bordered by Iraq and Turkey to the west, by Azerbaijan and Armenia to the northwest, by the Caspian Sea and Turkmeni ...
, Georgia
Georgia most commonly refers to:
* Georgia (country), a country in the Caucasus region of Eurasia
* Georgia (U.S. state), a state in the Southeast United States
Georgia may also refer to:
Places
Historical states and entities
* Related to the ...
and the Russian Federation
Russia (, , ), or the Russian Federation, is a transcontinental country spanning Eastern Europe and Northern Asia. It is the largest country in the world, with its internationally recognised territory covering , and encompassing one-eig ...
.
Main directions of SOCAR Georgia Gas activity comprise import into the Georgian market and sale of natural gas, as well as construction and rehabilitation of gas pipelines. In 2010, the company was honoured with 'Best Company of the year' for active participation in 'Gas provision of all villages' program of the Georgian President
Georgian may refer to:
Common meanings
* Anything related to, or originating from Georgia (country)
** Georgians, an indigenous Caucasian ethnic group
** Georgian language, a Kartvelian language spoken by Georgians
**Georgian scripts, three scrip ...
.
Baku Shipyard LLC
Baku Shipyard LLC is a shipyard plant in Azerbaijan. It is a joint venture between State Oil Company of Azerbaijan Republic, Azerbaijan Investment Company (AIC) and Keppel Corporation. The construction and operation of the plant is also a joint ef ...
joint venture was founded on 10 May 2011 under the laws of Republic of Azerbaijan, by the State Oil Company of Azerbaijan (SOCAR) owning 65%, Azerbaijan Investment Company (AIC) 25%, and Keppel Offshore Marine (KOM) 10%, has developed and put into operation the most modern shipbuilding and ship-repair facility in the Caspian Sea.
Opening ceremony of Star Oil Refinery was held on 19 October in Izmir, Turkey
Turkey ( tr, Türkiye ), officially the Republic of Türkiye ( tr, Türkiye Cumhuriyeti, links=no ), is a transcontinental country located mainly on the Anatolian Peninsula in Western Asia, with a small portion on the Balkan Peninsula in ...
with the participation of Ilham Aliyev and Recep Tayyip Erdogan
Recep may refer to:
People Surname
* Aziz Recep (born 1992), German-Greek footballer
* Sibel Recep (born 1987), Swedish pop singer
Given name
* Recep Adanır (born 1929), Turkish footballer
* Recep Akdağ (born 1960), Turkish physician and polit ...
. Since the beginning of the project, US$1 392.8 million has been allocated to finance the Azerbaijani share on the STAR project within the framework of the SOFAZ's budget execution.
On 15 July 2021, SOCAR signed a cooperation agreement with Technip Energies involving a joint pilot project to produce offshore energy on a floating wind turbine
A floating wind turbine is an offshore wind turbine mounted on a floating structure that allows the turbine to generate electricity in water depths where fixed-foundation turbines are not feasible.
Floating wind farms have the potential to signi ...
. Back in April of the same year, Azerbaijan had signed a memorandum of understanding with the International Finance Corporation
The International Finance Corporation (IFC) is an international financial institution that offers investment, advisory, and asset-management services to encourage private-sector development in less developed countries. The IFC is a member of ...
(IFC) in order to cooperate on offshore wind development. The cooperation between the two companies is to determine the potential of the countries offshore wind possibilities.
Locations
SOCAR's headquarter is located at a 42-floor SOCAR Tower which was under construction since 2010 and completed in late 2016. It is the tallest skyscraper in the Caucasus
The Caucasus () or Caucasia (), is a region between the Black Sea and the Caspian Sea, mainly comprising Armenia, Azerbaijan, Georgia (country), Georgia, and parts of Southern Russia. The Caucasus Mountains, including the Greater Caucasus range ...
with 209m of height. Apart from the head office, SOCAR's supporting offices are dispersed across the city.
The first representative office of SOCAR was established in London
London is the capital and List of urban areas in the United Kingdom, largest city of England and the United Kingdom, with a population of just under 9 million. It stands on the River Thames in south-east England at the head of a estuary dow ...
in 1994. Now the company has offices in London
London is the capital and List of urban areas in the United Kingdom, largest city of England and the United Kingdom, with a population of just under 9 million. It stands on the River Thames in south-east England at the head of a estuary dow ...
, Frankfurt am Main
Frankfurt, officially Frankfurt am Main (; Hessian: , "Frank ford on the Main"), is the most populous city in the German state of Hesse. Its 791,000 inhabitants as of 2022 make it the fifth-most populous city in Germany. Located on its na ...
, Geneva
, neighboring_municipalities= Carouge, Chêne-Bougeries, Cologny, Lancy, Grand-Saconnex, Pregny-Chambésy, Vernier, Veyrier
, website = https://www.geneve.ch/
Geneva ( ; french: Genève ) frp, Genèva ; german: link=no, Genf ; it, Ginevr ...
, Vienna
en, Viennese
, iso_code = AT-9
, registration_plate = W
, postal_code_type = Postal code
, postal_code =
, timezone = CET
, utc_offset = +1
, timezone_DST ...
, Bucharest
Bucharest ( , ; ro, București ) is the capital and largest city of Romania, as well as its cultural, industrial, and financial centre. It is located in the southeast of the country, on the banks of the Dâmbovița River, less than north of ...
, Istanbul
)
, postal_code_type = Postal code
, postal_code = 34000 to 34990
, area_code = +90 212 (European side) +90 216 (Asian side)
, registration_plate = 34
, blank_name_sec2 = GeoTLD
, blank_i ...
, Kyiv
Kyiv, also spelled Kiev, is the capital and most populous city of Ukraine. It is in north-central Ukraine along the Dnieper River. As of 1 January 2021, its population was 2,962,180, making Kyiv the seventh-most populous city in Europe.
Kyi ...
, Tbilisi
Tbilisi ( ; ka, თბილისი ), in some languages still known by its pre-1936 name Tiflis ( ), is the capital and the largest city of Georgia, lying on the banks of the Kura River with a population of approximately 1.5 million p ...
, Astana
Astana, previously known as Akmolinsk, Tselinograd, Akmola, and most recently Nur-Sultan, is the capital city of Kazakhstan.
The city lies on the banks of the Ishim River in the north-central part of Kazakhstan, within the Akmola Region, tho ...
and Tehran
Tehran (; fa, تهران ) is the largest city in Tehran Province and the capital of Iran. With a population of around 9 million in the city and around 16 million in the larger metropolitan area of Greater Tehran, Tehran is the most popul ...
.
Accidents
On 17 August 2013, a gas blowout occurred at the platform No.90 of Bulla Deniz field. As a result, the platform burned from 17 August to 24 October 2013. On 23 October 2014, four workers were killed and three workers were in injured when during repair works on the platform No. 441 at the Narimanov field a small wagon-house fell into the sea which damaged a gas pipeline and caused a fire. Altogether, fourteen SOCAR's workers were killed in oil and gas platforms accidents in 2014.[
On 4 December 2015, three workers of SOCAR were reported missing after part of the living quarters at ]Oil Rocks
An oil is any nonpolar chemical substance that is composed primarily of hydrocarbons and is hydrophobic (does not mix with water) & lipophilic (mixes with other oils). Oils are usually flammable and surface active. Most oils are unsaturated ...
fell into the sea due to a heavy storm. At the same day, seven workers were killed, 23 reported missing, and 33 were rescued and evacuated when a fire broke out on the platform No. 10 at the western section of the Gunashli oilfield.
(As of January 2016, a total of 10 bodies have been found, leaving 20 people unaccounted for.)
Corruption and controversies
SOCAR is often associated with the widespread corruption in Azerbaijan. In a 2011 survey by Transparency International
Transparency International e.V. (TI) is a German registered association founded in 1993 by former employees of the World Bank. Based in Berlin, its nonprofit and non-governmental purpose is to take action to combat global corruption with civil ...
concerning the anti-corruption practices of 44 oil companies, SOCAR ranked last. Frank Schwabe, a member of the German Bundestag
The Bundestag (, "Federal Diet") is the German federal parliament. It is the only federal representative body that is directly elected by the German people. It is comparable to the United States House of Representatives or the House of Common ...
and member of the Parliamentary Assembly of the Council of Europe
The Parliamentary Assembly of the Council of Europe (PACE) is the parliamentary arm of the Council of Europe, a 46-nation international organisation dedicated to upholding human rights, democracy and the rule of law.
The Assembly is made up ...
, sees SOCAR as a "central steering instrument for the foreign policy and sports policy of the authoritarian president of Azerbaijan."[Schweizer EM-Spiel in AserbaidschanKulisse für Despoten](_blank)
Deutschlandfunk. 12 June 2021, retrieved 23 December 2021 SOCAR is considered "well-connected" in Germany and plays a role in the wake of revelations about lobbying and corruption in connection with the Azerbaijani laundromat
The Azerbaijani laundromat is a complex money-laundering scheme organized by Azerbaijan that was revealed by the Organized Crime and Corruption Reporting Project (OCCRP) in September 2017. The investigations exposed that during two years between 2 ...
. The state-owned company supports, among other things, annual symposia organized by the Azerbaijani Embassy in Berlin and the German-Azerbaijani Forum association (DAF).[Die Baku-Connection: Wie Aserbaidschan in Deutschland schmiert und lobbyiert](_blank)
RedaktionsNetzwerk Deutschland
The (RND) () is the Hanover-based joint corporate newsroom of German . The biggest limited partner of Madsack is the , which is fully owned by the Social Democratic Party of Germany (SPD).
Madsack has the majority in regional newspapers with a ...
. 12 March 2021, retrieved 25 December 2021
Bribery and illegal payments
In 1997/1998, the government of Azerbaijan was in the process of privatizing SOCAR. In 2009 Frederic Bourke, founder of Dooney & Bourke
Dooney & Bourke is an American fashion company founded in 1975 by designer Peter Dooney and entrepreneur Frederic Bourke in Norwalk, Connecticut. Originally a men's supplier of belts, suspenders, and ties, the company now specializes in handbags ...
and Viktor Kožený were convicted by a court in Manhattan on paying bribes to the former president of Azerbaijan, Heydar Aliyev
Heydar Alirza oghlu Aliyev ( az, Һејдәр Әлирза оғлу Әлијев, italic=no, Heydər Əlirza oğlu Əliyev, ; , ; 10 May 1923 – 12 December 2003) was a Soviet and Azerbaijani politician who served as the third president of Az ...
, his son and first vice-president of SOCAR at that time Ilham Aliyev and other Azerbaijani government leaders to induce them to rig the privatization of SOCAR in Bourke’s and Kožený's favor. Bourke denied knowing about the bribes, while Kožený admitted bribing Azerbaijani leaders. According to the indictment, the total amount of bribes reached 11 million dollars.
According to a confidential ethics report, in 2013 SOCAR secretly funded a trip to a conference in Baku for 10 U.S. members of Congress and 32 of their staff. Three former senior advisers to then-President Barack Obama
Barack Hussein Obama II ( ; born August 4, 1961) is an American politician who served as the 44th president of the United States from 2009 to 2017. A member of the Democratic Party, Obama was the first African-American president of the ...
appeared as speakers at the event. The congressmen and their staff had their travel expenses and luxury gifts paid for by SOCAR worth hundreds of thousands of dollars. SOCAR allegedly funneled $750,000 in funds through nonprofit companies based in the United States to disguise the origin of the funds. Members of Congress participating in the trip later stated that they had not known that the trip had been funded by SOCAR. SOCAR itself stated that its sponsorship had never been a secret.
In 2017, it became known that SOCAR had made illegal payments totaling 28,000 euros to the Christian Democratic Union of Germany district association in Frankfurt
Frankfurt, officially Frankfurt am Main (; Hessian: , " Frank ford on the Main"), is the most populous city in the German state of Hesse. Its 791,000 inhabitants as of 2022 make it the fifth-most populous city in Germany. Located on it ...
in 2012. By accepting the donations, the party violated the Political Parties Act, as corporate donations from non-EU countries are prohibited. The case led to a years-long legal dispute with the Bundestag administration, of which the public did not learn.
In 2018, it became known that SOCAR paid a controversial donation of 3,000 euros to the German sports club "TuS Dexheim" in 2014. The donation was organized by the then-mayor of Oppenheim and former Social Democratic Party of Germany member of the Bundestag Marcus Held.
Murder of Maltese journalist Daphne Caruana Galizia
SOCAR is also part of corruption revelations that led to the murder of Maltese investigative journalist Daphne Caruana Galizia
Daphne Anne Caruana Galizia (; 26 August 1964 – 16 October 2017) was a Maltese writer, journalist, blogger and anti-corruption activist, who reported on political events in Malta. In particular, she focused on investigative journalism, repor ...
in October 2017.[Das Image des Ölhändlers leidet Socar – Feuer und Flamme für so vieles](_blank)
Public Eye
Public Eye or The Public Eye may refer to:
* ''Public Eye'' (TV series), a British television series that ran from 1965 to 1975
* ''The Public Eye'' (TV series), a Canadian television public affairs television series which aired on CBC Televisio ...
. 12 January 2021, retrieved 25 December 2021 SOCAR's Maltese chief is in custody as a main suspect in connection with the murder.[Aserbaidschanischer Ölkonzern SOCAR: UEFA beendet Partnerschaft mit umstrittenem Sponsor](_blank)
Deutschlandfunk. 13 May 2021, retrieved 24 December 2021
In April 2021, a Swiss court dismissed a lawsuit by SOCAR, in which Azerbaijan's state-owned company sought to prevent the disclosure of bank information to Latvian police. Latvia is investigating suspicious payments of about 28 million euros by Azerbaijani-controlled shell companies
A shell corporation is a company or corporation that exists only on paper and has no office and no employees, but may have a bank account or may hold passive investments or be the registered owner of assets, such as intellectual property, or ...
linked to an agreement between the Maltese government and SOCAR. The agreement became public during the investigative research of murdered journalist Daphne Caruana Galizia. Latvian authorities were able to force Swiss banks to release banking information about SOCAR in connection with the investigation of an international money laundering scandal.
War propaganda
In 2020, SOCAR came under criticism after it publicly engaged in war propaganda against Armenia
Armenia (), , group=pron officially the Republic of Armenia,, is a landlocked country in the Armenian Highlands of Western Asia.The UNbr>classification of world regions places Armenia in Western Asia; the CIA World Factbook , , and ' ...
on behalf of the Azerbaijani government during the 44-day Nagorno-Karabakh war between Armenia and Azerbaijan.[Aserbaidschanischer Ölkonzern SOCAR: UEFA beendet Partnerschaft mit umstrittenem Sponsor](_blank)
Deutschlandfunk. 13 May 2021, retrieved 24 December 2021
Sponsorship
Since 2012, SOCAR has sought to avoid U.S. sanctions aimed at Iran, its partner in a 28 billion dollar Caspian Sea natural gas project.
SOCAR funded an all-expenses-paid US-Azerbaijan "energy conference" in Baku for 10 members of Congress and 32 staff members which took place on 28 and 29 May 2013. It used two Houston based non-profit organizations, the Assembly of the Friends of Azerbaijan (AFAZ) and the Turquoise Council of Americans and Eurasians, both run by Kemal Oksuz as conduits.[
In May 2013, ]UEFA
Union of European Football Associations (UEFA ; french: Union des associations européennes de football; german: Union der europäischen Fußballverbände) is one of six continental bodies of governance in association football. It governs f ...
announced that SOCAR is an Official Sponsor of the 2016 UEFA European Football Championship final tournament, and acquires rights in connection with the European Qualifiers, which run from 2014 to 2017, and which relate to the qualification matches for UEFA Euro 2016
The 2016 UEFA European Football Championship, commonly referred to as UEFA Euro 2016 (stylised as UEFA EURO 2016) or simply Euro 2016, was the 15th UEFA European Championship, the quadrennial international men's football championship of Europe ...
and the 2018 FIFA World Cup. SOCAR also becomes an Official Sponsor of the 2016 UEFA European Under-17 Football Championship, which will take place in Azerbaijan.
In September 2014, SOCAR signed an agreement to become an Official Partner of Baku 2015 European Games
SOCAR is the sponsor of Association of Football Federations of Azerbaijan
The Association of Football Federations of Azerbaijan (AFFA; az, Azərbaycan Futbol Federasiyaları Assosiasiyası, AFFA) is the governing body of football in Azerbaijan. Formed in 1992, it is responsible for overseeing all aspects of the amate ...
and Azerbaijani football club Neftchi Baku.
SOCAR became the title sponsor and official partner for the 2019 Formula 1 Azerbaijan Grand Prix event held in Baku. To date, a one-year sponsorship agreement had been made.
In 2021 the UEFA quietly terminated its partnership with SOCAR without informing the public, after criticism of the sponsorship had grown stronger.
References
External links
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{{DEFAULTSORT:SOCAR
Oil and gas companies of Azerbaijan
Azerbaijan
Azerbaijan (, ; az, Azərbaycan ), officially the Republic of Azerbaijan, , also sometimes officially called the Azerbaijan Republic is a transcontinental country located at the boundary of Eastern Europe and Western Asia. It is a part of t ...
Companies based in Baku
Azerbaijani companies established in 1992
Azerbaijani brands
Automotive fuel retailers
Government-owned companies of Azerbaijan