BAKU

Azerbaijan is on track of increasing oil production by 7,000 barrels per day (bpd) in August in line with the country’s obligations under the OPEC+ deal, the Energy Ministry said.

The ministry said that oil production would still be below 718,000 bpd produced in October 2018, when members of OPEC+ agreed to reduce oil production gradually.

As the COVID-19 pandemic disrupted production as well as demand for oil, OPEC+, a group of the Organisation of the Petroleum Exporting Countries (OPEC) and allied producers of which Azerbaijan is a member, cut output by a little more than 7 million bpd to support prices and reduce oversupply.

In April 2021, members of the group agreed to ease cuts gradually by 350,000 bpd in May, another 350,000 bpd in June and around 450,000 bpd in July. Later, they also agreed to increase production further.

Azerbaijan was scheduled to increase its oil output gradually from May under a fresh deal agreed in April at a ministerial meeting of the OPEC+. The country’s quota under OPEC+ obligations in May was 603,000 bpd, 610,100 bpd in June and 620,000 bpd in July.

Last month, members of OPEC+ agreed to increase total production by 400,000 bpd.

“Azerbaijan is fulfilling its obligations on oil production within the framework of the OPEC+ deal,” the ministry said in a statement.

Most of Azerbaijan’s oil production comes from the giant offshore Azeri-Chirag-Guneshli (ACG) oilfields, developed by a BP-led consortium. The country uses the Baku-Tbilisi-Ceyhan (BTC) pipeline via Georgia and Turkey to export oil from the ACG. It also exports oil through the Baku-Novorossiisk pipeline via Russia, the Baku-Supsa pipeline via Georgia and by rail in Georgia.

BP said earlier this month that oil output at its projects in Azerbaijan declined to 468,000 bpd in the first half of 2021 from 498,000 bpd a year earlier.

BP said that in January-June, ACG completed six oil producer and three injector wells.

The country’s total oil and gas condensate production declined 4 percent from January to June from a year earlier to 17.177 million tonnes,

In 2020, Azerbaijan produced 34.585 million tonnes of oil and gas condensate, while natural gas output was 36.713 billion cubic metres (bcm).