Mining in Azerbaijan
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As of 2017,
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 th ...
produced a range of metals and industrial minerals, including
aluminum Aluminium (aluminum in American and Canadian English) is a chemical element with the symbol Al and atomic number 13. Aluminium has a density lower than those of other common metals, at approximately one third that of steel. It has ...
, bentonite,
copper Copper is a chemical element with the symbol Cu (from la, cuprum) and atomic number 29. It is a soft, malleable, and ductile metal with very high thermal and electrical conductivity. A freshly exposed surface of pure copper has a pinkis ...
,
gold Gold is a chemical element with the symbol Au (from la, aurum) and atomic number 79. This makes it one of the higher atomic number elements that occur naturally. It is a bright, slightly orange-yellow, dense, soft, malleable, and ductile met ...
,
iodine Iodine is a chemical element with the symbol I and atomic number 53. The heaviest of the stable halogens, it exists as a semi-lustrous, non-metallic solid at standard conditions that melts to form a deep violet liquid at , and boils to a vi ...
,
limestone Limestone ( calcium carbonate ) is a type of carbonate sedimentary rock which is the main source of the material lime. It is composed mostly of the minerals calcite and aragonite, which are different crystal forms of . Limestone forms whe ...
,
silver Silver is a chemical element with the Symbol (chemistry), symbol Ag (from the Latin ', derived from the Proto-Indo-European wikt:Reconstruction:Proto-Indo-European/h₂erǵ-, ''h₂erǵ'': "shiny" or "white") and atomic number 47. A soft, whi ...
and
steel Steel is an alloy made up of iron with added carbon to improve its strength and fracture resistance compared to other forms of iron. Many other elements may be present or added. Stainless steels that are corrosion- and oxidation-resistant ty ...
. Azerbaijan's importance as a world mineral producer, however, was based on its
petroleum Petroleum, also known as crude oil, or simply oil, is a naturally occurring yellowish-black liquid mixture of mainly hydrocarbons, and is found in geological formations. The name ''petroleum'' covers both naturally occurring unprocessed crud ...
extracting industry. The country has been a significant oil producer for more than a century, but recent focus has been on developing offshore resources in 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 ...
. Production from the country’s
Soviet 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, ...
-era fields are in decline, but since independence, foreign direct investment in offshore fields had revitalized the oil sector through the development of large-scale new projects and the refurbishment of older ones. In 2005, Azerbaijan had signed more than 20 major agreements to develop oilfields with approximately 30 companies from 15 countries.Richard M. Levine and Glenn J. Wallace
"The Mineral Industries of the Commonwealth of Independent States"
''2005 Minerals Yearbook''.
U.S. Geological Survey The United States Geological Survey (USGS), formerly simply known as the Geological Survey, is a scientific agency of the United States government. The scientists of the USGS study the landscape of the United States, its natural resources, and ...
(December 2007). ''This article incorporates text from this U.S. government source, which is in the
public domain The public domain (PD) consists of all the creative work A creative work is a manifestation of creative effort including fine artwork (sculpture, paintings, drawing, sketching, performance art), dance, writing (literature), filmmaking, ...
.''
As of 2017, oil production has entered a decline, falling by 5.6% since 2016. Crude petroleum has declined in Azerbaijan since 2010, when the nation produced a record 50.8 MT. Production in 2017 was only 38.7 MT. In 2005, Oil extraction and refining accounted for more than 75% of the value of industrial production. The oil extraction and refining sectors and the
metallurgy Metallurgy is a domain of materials science and engineering that studies the physical and chemical behavior of metallic elements, their inter-metallic compounds, and their mixtures, which are known as alloys. Metallurgy encompasses both the sc ...
and metal fabrication sectors employed more than 60,000 people in 2005. The country was becoming a major producer of oil, producing far more than it consumed, but its
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 ...
production in 2005 was still significantly below its consumption. The country was increasing its steel products production at the
Baku Baku (, ; az, Bakı ) is the capital and largest city of Azerbaijan, as well as the largest city on the Caspian Sea and of the Caucasus region. Baku is located below sea level, which makes it the lowest lying national capital in the world a ...
Steel company, a privately owned company that produced steel products from steel scrap.


Production

In 2005, production increased for practically all mineral commodities. Crude petroleum production increased by more than 43% compared with that of 2004. The country was developing its steel industry, although it is still on a small scale.


Trade

Fuels accounted for 76% of the value of exports in 2005. The country’s major export was crude petroleum, almost all of which was sold on world markets rather than supplied to other
CIS Cis or cis- may refer to: Places * Cis, Trentino, in Italy * In Poland: ** Cis, Świętokrzyskie Voivodeship, south-central ** Cis, Warmian-Masurian Voivodeship, north Math, science and biology * cis (mathematics) (cis(''θ'')), a trigonome ...
countries. Other mineral exports included petroleum refinery products and alumina. The country imported a variety of mineral commodities, including natural gas.


Mineral resources

Azerbaijan’s major mineral wealth is its oil and gas reserves. Offshore
hydrocarbon In organic chemistry, a hydrocarbon is an organic compound consisting entirely of hydrogen and carbon. Hydrocarbons are examples of group 14 hydrides. Hydrocarbons are generally colourless and hydrophobic, and their odors are usually weak or ex ...
structures in the Caspian Sea accounted for most of the country’s oil and gas production. Azerbaijan’s proven
crude oil Petroleum, also known as crude oil, or simply oil, is a naturally occurring yellowish-black liquid mixture of mainly hydrocarbons, and is found in geological formations. The name ''petroleum'' covers both naturally occurring unprocessed crude ...
reserves were estimated to range from 7 billion to 13 billion barrels (Gbbl) r from about 950 million metric tons (Mt) to 1.8 billion metric tons (Gt)based on various industry journals and Government sources. The State Oil Company 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 th ...
Republic (SOCAR) has estimated that proven reserves are 17.5 Gbbl (about 2.4 Gt) using the Soviet reserve classification system. This evaluation was not based on market economy criteria and may include resources that are not economically viable. Estimates of natural gas reserves also vary. According to the Oil & Gas Journal, Azerbaijan has proven natural gas reserves of roughly 30 trillion cubic feet (about 850 billion cubic meters, and BP p.l.c. estimates that the country has 48 trillion cubic feet (about 1.4 trillion cubic meters) of proven gas reserves.


Outlook

Although some effort has been made to promote balanced mineral development of all the country’s
mineral resources Natural resources are resources that are drawn from nature and used with few modifications. This includes the sources of valued characteristics such as commercial and industrial use, aesthetic value, scientific interest and cultural value. O ...
, the country’s economic development has depended primarily on the development of its large offshore oil and gas resources. These resources are expected to be the country’s chief source of revenue for the coming decades. In 2004, Azerbaijan exported approximately of oil. Exports are expected to more than double to in 2006 and to reach as high as by 2008. Azerbaijan was a net natural gas importer in 2005. The country is expected to become a significant gas exporter following the development of the Shah Deniz natural gas deposit, which is considered to be one of the world’s largest natural gas field discoveries of the past 20 years. According to BP (the project operator), Shah Deniz has potential recoverable reserves of about 15 trillion cubic feet (about 424 billion cubic meters) of natural gas and —about 82 Mt] of condensate. Other industry and trade sources have estimated that the field contains as much as of gas. The field is being developed by the Shah Deniz consortium, whose members include BP, LukAgip,
National Iranian Oil Company The National Iranian Oil Company (NIOC; fa, شرکت ملّی نفت ایران, Sherkat-e Melli-ye Naft-e Īrān) is a government-owned national oil and natural gas producer and distributor under the direction of the Ministry of Petroleum of Ir ...
(NICO) International, SOCAR, Statoil ASA of Norway, TotalFinaElf, and Türkiye Petrolleri Anonim Ortaklig (TPAO) of Turkey. In the first phase of the Shah Deniz field’s development, production of natural gas for export was expected to begin in late 2006. In the second phase, according to BP, the Shah Deniz project could produce an additional per year of natural gas by as early as 2015. Although Azerbaijan lacks any infrastructure for the export of natural gas, efforts were underway to secure export routes and customers for gas deliveries beginning in 2006. The main conduit for Azerbaijan’s natural gas exports would be the South Caucasus Pipeline, also known as
Baku Baku (, ; az, Bakı ) is the capital and largest city of Azerbaijan, as well as the largest city on the Caspian Sea and of the Caucasus region. Baku is located below sea level, which makes it the lowest lying national capital in the world a ...
-
Tbilisi Tbilisi ( ; ka, თბილისი ), in some languages still known by its pre-1936 name Tiflis ( ), is the Capital city, capital and the List of cities and towns in Georgia (country), largest city of Georgia (country), Georgia, lying on the ...
-Erzurum, which would run parallel to the Baku-T’bilisi-Ceyhan oil pipeline for most of its route before connecting to the Turkish gas pipeline network near the town of Horasan in
Turkey Turkey ( tr, Türkiye ), officially the Republic of Türkiye ( tr, Türkiye Cumhuriyeti, links=no ), is a list of transcontinental countries, transcontinental country located mainly on the Anatolia, Anatolian Peninsula in Western Asia, with ...
. Pipeline construction began in late 2004 and was scheduled to be completed during the first quarter of 2007. The pipeline was expected to carry per year initially; this volume could be increased later to up to per year with the future addition of compression stations. With the new pipeline infrastructure in place, Shah Deniz would be capable of producing approximately per year of natural gas by 2009. Supplies of natural gas from Shah Deniz and associated gas from the Azeri Chirag Gunashli (AGC) and the Bakhar-2 projects are expected to make Azerbaijan self-sufficient in natural gas and to result in significant export revenues.


References

{{DEFAULTSORT:Mineral Industry Of Azerbaijan Mining in Azerbaijan Economy of Azerbaijan Energy in Azerbaijan