STATE OIL COMPANY OF AZERBAIJAN REPUBLIC



History of SOCAR

State Oil Company of Azerbaijan Republic (SOCAR) was established in base of 'Azneft' State Concern and 'Azerneftkimya' Production Unit in order to carry out use of oil resources of Azerbaijan Republic in base of sole state policy, improve management structure of oil industry, ensure development of fuel-energy complex due to increasing the effectiveness of use of production power of oil producing and oil processing enterprises. SOCAR was established by Decree 200 dated 13 September 1992 of President of Azerbaijan Republic. New management structure of SOCAR was confirmed by Order 328 dated 26 February 1993 of President of Azerbaijan Republic.

After this new management structure of SOCAR was confirmed by Order 50 dated 26 January 1994 of President of Azerbaijan Republic. Production units having right of enterprise, trust and departments having right of enterprise and departments having right of individual structure unit were included in its management structure.

By Decree 844 dated 24 January 2003 of President of Azerbaijan Republic 'On improvement of structure of State Oil Company of Azerbaijan Republic' Regulations and structure of State Oil Company of Azerbaijan Republic was confirmed.

By mentioned Decree SOCAR shall:

- merge Offshore Oil and Gas Production Unit with Onshore Oil and Gas Production Unit and establish 'Azneft' Production Unit in their base;

- merge Foreign Economic Ties Department with 'Azernefttejhizat' Unit and establish 'Marketing and Economic Operations' department in their base;

- establish 'Oil lines' department in base of Main Oil Lines Production Unit;

- establish 'Baku Deep Water Jacket Plant' in base of 'Shelflayihetikinti' Production Unit;

- establish 'Azerneftyagh' Oil Refinery in base of 'Azerneftyagh' Production Unit;

- establish 'Azerneftyanajag' Oil Refinery in base of 'Azerneftyanajag' Production Unit.

Then trusts 'Khezerdenizgazmatikinti', 'Khezerdenizneftsosialtikinti' and Auto transport bureau of SOCAR were announced open to privatization.

Duties and object of activity of SOCAR

Activity of SOCAR consists of assurance of effective activity and development of oil and gas industry as a sole complex, meeting the demands of consumers to energy resources in a reliable manner.

SOCAR is consisted of implementation of exploration, preparation, exploitation of oil and wells within territory of Azerbaijan Republic, including offshore and onshore areas, transportation, processing and sale of oil, gas, condensate and products getting from them, meeting the demands of consumers to energy resources in stable and constant manner, other works and services, and gaining revenue.

To fulfill its major duties, Company carries out following types of activity in a manner set by legislation:

- elaborate long-term forecasts on development of the sphere, purposeful and complex scientific technical, economic and social programs;

- increase effectiveness of production, carry out policy of saving energy and material resources, create effective production-technological and economic ties among field enterprises;

- ensure mutual ties between Company and state agencies with respective authorities in determining the future development of the sphere;

- develop production and social base of the sphere, modernize, enlarge, reconstruct the enterprises of Company, for ensuring them with new technique and technologies implement investment activity according to legislation;

- implement geological-exploration works by using modern building technologies and technical means, increase effectiveness of exploitation of wells, accelerate construction of oil and gas wells, as well lift quality and speed of preparation of wells to exploitation by observing the legislation existing in field of use of underground and environment;

- improve household methods and forms, apply scientific achievements in production;

- involve credits of banks, as well foreign banks and other sources to implement economic and production-technical programs;

- organize implementation of personnel policy, preparation of personnel in republic and overseas and raising the qualification;

- create effective possibilities due to consolidation of material base of social field for social progress of enterprise collectives;

- establish mutual cooperation with state agencies, foreign companies and businessmen;

- ensure elaboration and confirmation in respective manner of geophysical, geological search-exploration works;

- adopt decisions on exploitation of newly discovered wells, prepare and confirm in respective manner practice-industry exploitation projects, technological schemes of wells exploited by enterprises, projects on exploitation of oil, gas and gas-condensate wells;

- confirm annual working plans of oil and gas production enterprises and according to these programs determine their annual budget funds;

- organize transport of produced crude oil and natural gas and pay transport fee determined for the service to transport enterprises;

- organize processing of crude oil and natural gas, pay processing costs determined for by Company for services to oil and gas refining enterprises;

- organize sale of crude oil, natural gas, oil and gas products and pay in respective manner their supply costs;

- take necessary measures for restoration of lands and protection of environment;

carry out foreign trade ties according to legislation and etc.

Structure of SOCAR

I. Management Structure of State Oil Company of Azerbaijan Republic

1. Direction

- President
- The first vice-president on geology, geophysics and field development issues
- The vice-president on economic issues
- The vice-president on investment and marketing
- The vice-president on refining issues
- Vice-president
- The vice-president on social affairs
- The vice-president on ecology
- The vice-president on cadre, regime and information technologies

2. Apparatus of Company

II. Enterprises within State Oil Company of Azerbaijan Republic:

1. 'Azneft' Production Unit
2. 'Geophysics and engineering geology' Production Unit;
3. 'Oil lines' Department;
4. 'Marketing and economic operations' Department;
5. 'Foreign investments Department;
6. 'Azneftyagh' Oil Refinery;
7. 'Azneftyanajag' Oil Refinery;
8. Baku Deepwater Jacket Plant.

Address of SOCAR

Address: 73, Neftchilar Ave., AZ 1000, Baku city
Tel.: 492-06-85
Fax: 497-11-67
E-mail: info@socar.az
Web site: www.socar.az
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