Press Release
"Caspian Oil and Gas"- 2009
"Today, Azerbaijan is not just an attractive country from a resource and investment point of view, but also a reliable and predictable partner in the energy sphere." Ilham Aliyev, President of the Republic of Azerbaijan.
On 2 June, the 16th International "Caspian Oil and Gas" exhibition got underway in the Azerbaijani capital Baku. The exhibition and conference takes place under the patronage of His Excellency Mr. Ilham Aliyev, President of the Republic of Azerbaijan. The project is supported by the Ministry of Industry and Energy of the Republic of Azerbaijan and the State Oil Company of the Azerbaijani Republic (SOCAR). The event is organised by ITE Group (UK), together with the Chamber of Commerce and Industry of the Republic of Azerbaijan. Partners companies of ITE Group - Iteca Caspian (Azerbaijan), ITE Moscow (Russia), EUF (Turkey), GiMA (Germany), ITE China and ITE Gulf (UAE) - worked on attracting international companies to take part in the exhibition.
The exhibition began with the official opening ceremony, which has a format not found amongst other events in Azerbaijan. The official opening ceremony was attended by leaders and representatives of energy industry ministries from 20 countries, representatives of the diplomatic community in Azerbaijan and exhibition participants. The guest of honour at the opening ceremony was Mr. Ilham Aliyev, President of the Republic of Azerbaijan. The following people gave a few words of welcome: Sir Andrew Wood, Senior Advisor, ITE Group; Mr. Nika Gilauri, Prime Minister of Georgia; Mr. Richard Morningstar, U.S. Special Envoy for Eurasian Energy; His Royal Highness The Duke of York, the United Kingdom's Special Representative for International Trade and Investment; Mr. Yusuf Yazar, Deputy Minister of Energy and Natural Resources; and Mr. Robin Kass, State Secretary of the Norwegian Ministry of Petroleum and Energy.
The opening of the exhibition began with a welcome from Sir Andrew Wood. Having welcomed all the guests, Mr. Wood remarked upon the importance of the "Caspian Oil and Gas"exhibition and expressed particular gratitude to the President of Azerbaijan for his support of the largest event in the Caspian region.
Mr. Ilham Aliyev, President of Azerbaijan, then addressed the participants of the event and congratulated all those present on the occasion of the 16th "Caspian Oil and Gas"exhibition and on the fact that it has become a meeting place for those interested in working with Azerbaijan in the strategically important energy industry: "I sincerely welcome all of you. Today is an important, traditional day for us. The "Caspian Oil and Gas" exhibition is being held for the sixteenth time in Baku. This event has taken its place in the international arena. The first such exhibition 16 years ago was a demonstration to the world of Azerbaijan's energy potential. I would like to express deep gratitude to the organisers of the exhibition as, thanks to their efforts, people have discovered Azerbaijan." In his speech, the President noted: "Since 1994, the government has increased its attention to the country's oil and gas sector, signing the 'Contract of the Century'. The contract was signed in spite of the fact that during that period there was an unstable socio-political situation in Azerbaijan. This was a major event for the period." The President, underlining the major role played by Azerbaijan in the energy security of the region, said that the "oil factor is not an objective for our country, but a means of achieving objectives". Mr. Aliyev reported that subsequent steps will, above all, serve Azerbaijan's national interests and, at the same time, make a difference at the international level. "In the coming years, Azerbaijan will continue to be a reliable energy partner. At the same time, the country is willing to be both a producer and transit country for hydrocarbons. This is due to the advantageous geographical location of the country and the presence of modern infrastructure... Azerbaijan has achieved all of its intended aims in the energy sector. Today, the country exports gas to neighbouring countries and the volume of exports will grow in the future. We have fully managed to settle the issue of diversification," said President Aliyev. At the end of his speech, the President of Azerbaijan wished all the exhibition participants success and productive work.
In his speech, the Prime Minister of Georgia, Nika Gilauri, said that Azerbaijan's increased role as an energy supplier in the region increases Georgia's transit opportunities. "The role of Azerbaijan in the energy security of the region is growing. This opens up the possibility of turning Georgia into a transit country for Europe." The Georgian Prime Minister added that, while in January of this year Europe had experienced a gas crisis, Georgia managed to avoid the problem thanks to the assistance of Azerbaijan.
Mr. Morningstar read out a letter from U.S. President Barack Obama addressed to the President of Azerbaijan on the occasion of the opening of the exhibition. In the letter, President Obama highlighted the significance of Azerbaijan as an important and reliable supplier of energy to world markets, and added that, in the development of energy resources, Azerbaijan will find in the United States a reliable friend and partner. "We support your efforts to develop your natural gas fields to help diversify regional supplies, which will benefit your country and your neighbours alike," says President Obama in the letter. At the end of the letter, the U.S. President expressed his desire to continue working closely with Azerbaijan.
HRH The Duke of York continued the opening ceremony. In his speech, His Royal Highness said that he was glad to be at the event. He also noted the special role that the UK has traditionally played in the Caspian region. The Duke of York then read out a welcome message from British Prime Minister Gordon Brown: "It is no coincidence that the history of this exhibition coincides with a period of remarkable growth, and with the transformation of the Azerbaijani economy. The UK is proud to have been Azerbaijan's partner throughout the last 16 years, and I am sure British and Azerbaijani companies will continue to work closely together for many years to come. I hope all participants enjoy a successful week."
Mr. Yazar spoke about his country's support for all the energy projects realised by Azerbaijan in the South Caucasus, and wished everyone success in the exhibition.
Mr. Kass congratulated everyone on the opening of the exhibition and expressed his support for the oil strategy developed by Mr. Heydar Aliyev, National Leader of the Republic of Azerbaijan, and successfully continued by the current President, Ilham Aliyev. Mr. Kass then read out a welcome message from Norwegian Prime Minister Jens Stoltenburg. In the message, Prime Minister Stoltenburg spoke about the mutual understanding between Norway and Azerbaijan in solving environmental problems, and continuing cooperation between the countries in this area and others.
After the opening ceremony, President Aliyev and the other VIP guests completed a tour of the exhibition.
For one day, the Azerbaijani capital turned into a transnational platform, where oil industry players demonstrated their achievements, shared experience and held discussions about exploring, producing and exporting hydrocarbons to the global market. This year's oil forum brought together representatives of 300 companies from 22 countries. The range of the exhibition is proof of its importance in the region. This year's exhibition included megaprojects to develop oil and gas fields, construction and exploitation of oil and gas wells, transportation of hydrocarbons, proposals to manufacture special equipment, construction and assembly work in the energy sector and various technical services such as financial and legal services. More than 40 % of the participants were companies known throughout the world, the majority of which regularly attend "Caspian Oil and Gas". These included: BP, Itochu, OMV Gas International GmbH, SOCAR, StatoilHydro ASA, Total, TRAO and many others. The regular participation of the oil giants is proof that the Azerbaijani oil and gas industry is still attracting investors who not only want to receive dividends from implementing joint projects, but who also want to contribute to the development of an independent Azerbaijan and of the region as a whole.
National group stands from China and Germany were again present at this year's event. Russia and Turkey displayed particular interest in the show. In total, the number of companies rose by 20 %. The global financial crisis did not affect the number of companies participating for the first time. Eighty new companies entered the Azerbaijani market for the first time, which amounts to 20 % of the total number of exhibitors. This is proof of the constantly growing interest in the region and its opportunities. For example, visitors to "Caspian Oil and Gas"got to see the striking stand of the Turkish petrochemical company Petkim for the first time. Company representatives spoke in detail about their business and how SOCAR is an investor in Turkey's petrochemical market. At SOCAR's stand it was possible to learn about the process of extracting oil from the depths of the Caspian and transporting it by pipeline. A model with oil derricks, machinery, small-scale cisterns and a special mechanism showed how deep water oil extraction works. The model demonstrated a unique technique, devised and patented in Azerbaijan, for extracting oil from the depths of the sea with the application of nanotechnology. Khoshbakht Yusif-Zade, Vice-President of SOCAR, spoke in detail about this remarkable procedure at the"Caspian Oil and Gas - 2009" conference. It was also possible to find out about SOCAR's social programme for oil workers, which includes municipal housing, hospitals, benefits etc.
The state companies Azerkimya and Azerenergy, and other representatives of the country's energy sector had stands at the exhibition.
Russia's Ministry of Energy presented a single national stand which included leading companies from Russia's fuel and energy sector. The stand presented the main areas of activity of the Russian Ministry of Energy, the structure of Russia's oil and gas industry and the products and services of Russian fuel and energy companies, including Novomet Perm, CHETRA Spare Parts and Components, Tasma, Albatros and others.
The RWE (Germany) and OMV (Austria) stands - participants in the Nabucco gas pipeline project - offered visitors the chance to learn about new opportunities for transporting gas to Europe.
A significant part of the exhibition space was taken up by companies not directly connected with the oil and gas industry, but offering related services. One such participant was Magnitogorsk Iron and Steel Works, whose product - a 5000 mm plate mill, with a unique combination of strength and plasticity - interested representatives of shipbuilding, engineering and oil companies. CzechTourism, a company offering oil workers traditional health resort breaks, participated in the event for the first time.
The exhibition's programme of events was very busy. On the first day of the exhibition, the Russian Ministry of Energy hosted a round table meeting at their stand. The topic of the discussion was "The cooperation of Russia's Ministry of Energy with businesses of the fuel and energy industry in holding exhibitions and congressional events". Mr. Dorzhinkevich, who chaired the meeting, stressed the importance of supporting small and medium businesses, and demonstrated a willingness to devote special attention on the part of the ministry to working with businessmen.
One of the most important events of the exhibition was the planned discussions of the State Oil Company of the Azerbaijan Republic (SOCAR) on selling Azerbaijani gas acquired through a partnership to process the Shah Deniz gas condensate field in the Azerbaijani sector of the Caspian Sea. Representatives of various companies with an interest in buying Azerbaijani gas attended the exhibition in Baku. Mr. Movsumov, Head of the State Oil Fund of Azerbaijan, said that during the exhibition and conference he was looking at reviewing contracts with international companies that end in 2014. Foreign partners in the Production Sharing Agreement intend to pump more investment into the project, but want guarantees that they will receive a good return on their investment.
The second day of the exhibition was noteworthy for its business rhythm, discussions and seminars, as well as the handing out of awards. Every year, the organisers award exhibitors for their creative approach to participating in the exhibition. Participants of the exhibition and conference were given certificates for taking part and several surprise gifts - exclusive souvenirs with an oil theme. The winners were: Retkim - for best debut, Statoilhydro - for most innovative design, German Group - for best collective participation, Cross Caspian - for best design, and Azerkimya - for length of cooperation.
"Resources of the Caspian Basin: Exploration, Production and Investments", a traditional event of the Caspian International Oil and Gas Exhibition, began on 3 June in the conference centre of the Hyatt Regency.
Today, as European countries experience a deficit in energy supplies, there is much interest in the prospects of this region of the world, from the point of view of extraction and transportation of gas and oil. The attention of the world community is, as never before, riveted on the Caspian's oil and gas fields, which can play a great role in providing energy security on a global scale. This state of affairs was reflected in the topics of the "Caspian Oil and Gas 2009" conference, in which 450 delegates from 23 countries participated.
The first day of the conference programme was dedicated to a discussion of current exploration projects and potential oil and gas fields in the Caspian region, and touched upon the issue of investment in Azerbaijan's oil and gas sector. The following spoke on the first day of the conference: Mr. Natig Aliyev, Minister of Industry and Energy, Azerbaijan; Mr. Morningstar; Detlef Dauke, Director General for Energy policy for Energy Policy, Federal Ministry of Economics and Technology, Germany ; Stanislav Dorzhinkevich, Deputy Director, Department of State Energy Policy, Ministry of Energy of the Russian Federation; Maci Biavik, Chief Expert, Oil and Gas Department, Ministry of Economics of the Republic of Poland; Michael Nobel, Chairman of the Nobel Charitable Trust; Yusuf Yazar, Deputy Undersecretary, Ministry of Energy and Natural Resources of the Republic of Turkey; Rovnag Abdullayev, President, SOCAR; Kristian B.Hausken, President, StatoilHydro in Azerbaijan; Novruz Guliyev, Deputy Minister of Ecology and Natural Resources of the Republic of Azerbaijan; Gregory Mattson, Vice President of HSE and Technical Services, BP, Azerbaijan SPU; Elnour Babaiev, Country Manager, Georgia and Azerbaijan, Weathford; Don Mckelvie, Director, Caspian Region, Baker Hughes; Angus Miller, Caspian Energy Adviser, Climate Change and Energy Group, Foreign & Commonweal th Office, United Kingdom; Yurdal Ustash, Vice President, TRAO; Kairgeldy Kabyldin, President, KazMunayGas; James Hogan, Managing Partner, Salans Limited; Naila Mehrabova, General Director, "Cross Caspian Oil and Gas" Logistics LLC; Dr Jennifer Coolidge, Executive Director, CMX Caspian and Gulf Consultants Ltd; Kanan Yavuz, General Manager, Petkim Petrochemicals Holding Co.
In his official welcome speech at the opening of the conference, Mr. Aliyev said: "In recent years, the world's governments have repeatedly asked themselves a question of paramount importance - how to provide fair, economically effective and safe access to energy resources. Today, the key issue in developing the hydrocarbon resources of the Caspian Region is the choice of export routes for natural gas, the demand for which grows year on year in Europe. In this regard, the role of our country is extremely important as its potential gas reserves are estimated at 2 - 5 trillion cubic metres." The minister highlighted the role of the "Caspian oil and Gas" conference, which every year brings together people interested in the energy sector of the Caspian Region and provides a platform for discussing current issues and prospects for developing cooperation.
The speakers on the second day of the conference were: Academician Khoshbakht Yusifzade, First Vice President, SOCAR; Reinhard Mitschek, Nabucco Gas Pipeline International GmbH, Managing Director; Elio Ruggeri, ITGI Project Leader, Director of Business Development, Edison S.P.A.; Sveinung Dankel, Lead Negotiator for Gas Transportation, StatoilHydro, Azerbaijan; Robert Klein, Managing Director, Trans Adriatic Pipeline Project; Terence Murphy PhD, Department of International Relations, American University in Paris; Elshad Nasirov, Vice President for Investment and Marketing, SOCAR; Dr. Sven Wolf, Vice President, Gas Supply Division, E.ON Ruhrgas AG; Michael Peisser, OMV Gas & Power GmbH, head of Business Unit Gas Supply, Marketing and Trading; Markus Brokhof, Head of Gas Supply & SEE, EGL Group; Jeremy Ellis, Head of Business Development, RWE Supply and Trading GmbH; Kate Hardin, Senior Director, Russian & Caspian Energy, CERA; John Roberts, Energy Specialist, Platts; Vagif Aliyev, Head of International Investments Department, SOCAR; Wolfgang Sporrer, Country Manager, Caspian Region, OMV Gas & Power GmbH; Roberto Poti, Executive Vice President, International, Renewable Sources & Special Projects , Edison S.P.A.; and Julia Nanay, Senior Director, PFC Energy.
The third meeting, on the second day, was an interactive panel discussion on the theme "South Caspian: Azerbaijan, Iran, Turkmenistan: Further Prospects for Regional Cooperation and Transportation of Hydrocarbons". The topics discussed included gas supply distribution between supplier countries - Azerbaijan, Iran, Turkmenistan and Iraq - developing cooperation between Azerbaijan and Turkmenistan as a basis for negotiations on the division of the Caspian Sea's resources and the TransCaspian highway project, and the advantages and obstacles of Iran as a potential exporter of gas to Europe. The results of the conference were summarised in heated debates.
The conclusion reached by the conference delegates on the final day was that new international investment projects are needed, as the exploration and production of oil and gas in the Caspian is a complex and laborious process. The modern reality is such that companies must work together to implement joint investment projects. The opportunities for interested parties to establish contacts at the conference are invaluable, and Azerbaijan is well placed to largely determine the future development of relations in the Caspian region's energy resources market.
Along with the business programme, the organisers arranged a number of events to entertain guests. An evening reception was held at Villa Petrolea, home of the Baku Nobel Oil Club. At the reception, Mr. Togrul Bagirov, chairman of the Baku Nobel Heritage Fund, awarded the Immanuel Nobel medal to the organisers of the exhibition and conference. The important award again recognises the contribution of the exhibition and conference to the development of Azerbaijan's oil industry.
The "Caspian International Oil and Gas - 2009" Exhibition was again one of the biggest events of the year in the region's oil industry. The oil forum enabled participants to seek out partners, exchange information and new technologies, and develop a joint strategy for further developing the oil industry. This year, despite the fact that the oil and gas industry has been badly hit by the global financial crisis, the exhibition was a success.