Business

SOCAR's BTC SHARE SHRINKS TO 25%

Chief of SOCAR's foreign economic relations department Valeh Alasgarov held a news conference at the company Friday to update journalists on the meeting of the Executive Committee on the Baku-Tbilisi-Ceyhan Oil Pipeline Project on March 25 in London. The keynote event in the British capital, where the participants in the project shared stakes, was the reduction of SOCAR's part in the project from 45% to 25%. bp has 38.2%, Statoil - 9.58%, ENI - 5%, Itochu - 3.5%, TPAO - 7.55%, and Delta - 2.36%.

The motivation to concede the stake is the company's commercial interests, as the Azeri share in the project will be funded by SOCAR and partly the State Oil Fund. Negotiations are in place to finance 30% of the SOCAR share.

The project was originally estimated at $2.9 billion, while it is now difficult to figure out an exact cost, V. Alasgarov said. "Active work is underway, and the construction of the BTC is to be completed before the end of 2004, while the first tanker carrying crude will be dispatched from the Turkish port of Ceyhan to international markets in January of 2005.", he said, adding that SOCAR is interested in participation of such oil majors as LUKoil, ExxonMobil, Chevron and others. These giants can apply to the Sponsors' Group for buying into the remaining 12.5%. The agreement on the construction of the BTC Main Export Pipeline was signed in November, 1999. Projecting work started in May last year after the document was ratified in the parliaments of Azerbaijan, Georgia and Turkey in November of 2000 and is expected to complete in June this year.

"This is the most commercially viable option, which has drawn approval from international organizations", Mr. Alasgarov noted. Azerbaijan has enough crude to secure unfailing operation of the pipe even if Kazakh and Turkmen oil is not supplied to it, according to the SOCAR executive.

NEW MERCEDES BRAND IN BAKU

By Afgan Mammadov Azernews Staff Writer

A new Mercedes E Class W211 was presented in a ceremony at the Autostar Caucasus GmbH Baku-Mercedes Benz with attendance of diplomats, representatives from foreign companies, local ministries and businessmen.

As was informed in one of our previous issues, the international presentation of the new brand was held in Brussels.

Auto Star's marketing manager Jahangir Hasanov had the following to say of the new model to Azernews:

"EClass W211 is 23 mm wider and 12 mm higher than previous models. It has a new brake system, while pneumatic pillows regulate balance in the dial control airmatic. This allows the car to rise 5.5 centimeters. In addition, the motor has a 13.2 liter fuel energized engine of 224 horse power and its diesel powered CDI is 150 horse power strong. The 8-cylynder engine will reach 306 horse power". Mr. Hasanov added that the interest in the new brand is the ever highest following an influx of orders. "Our prices are cheaper than in 'gray dealers'. The E Class is sold at $60-58 in other outlets, but in our company you can get it at $44-45.", he indicated.

AZERBAIJAN, RUSSIA TO SIGN NEW AGREEMENTS

8 new agreements will be signed in a meeting of the Azeri-Russian intergovernmental commission on economic cooperation in Baku on April 9-10.

The agreements are on mutual protection of investments, railway, combat against smuggling and international terrorism, customs cooperation, etc., Russian ambassador to Azerbaijan Nikolay Ryabov has told journalists.

The Russian governmental delegation led by Deputy Premier Viktor Khristenko is expected to arrive in Baku Tuesday.

The intergovernmental meeting under the co-chairmanship of Viktor Khristenko and Azeri Deputy Premier Abbas Abbasov will center on possibilities of implementing joint economic projects and deepening bilateral commercial and economic relations.

AUSTRIAN EXPERTS CHOOSE SHAKI FOR TOURISM

By Azernews Staff

Austrian tourism experts have chosen Shaki, the northern Azeri town, for establishment of a toursim center following a lengthy visit to Azerbaijan.

The delegation is interested in constructing winter tourist bases in the north of Azerbaijan. Before leaving home, the experts said they would move concrete proposals for their Minister for Tourism, who is scheduled to visit Azerbaijan in May of this year. The mission said the proposals would be included in their pilot projects.

During the visit to Azerbaijan the Austrian delegation held meetings with the ministers for economic development, youth, sports and tourism, culture and ecology and natural resources.

In a meeting with the experts, minister for youth, sports and tourism Abulfaz Garayev moved some proposals, according to the Ministry.

The minister invited the visitors to an international tourism exhibition, due in Baku in May, saying the population, territory and natural conditions of the two states are the same, and offered the Austrian investors to join the construction of winter tourist bases in northern Azerbaijan.

MUSAVAT PRESENTS POVERTY REDUCTION PROGRAM

Chairman of the Economic Commission of the Musavat party Gubad Ibadoglu introduced the party's poverty reduction program for Azerbaijan Thursday. The program was prepared in cooperation with British Oxfam and national Himayadar humanitarian organization.

The document consists of 3 parts and 16 chapters. The first part is devoted to the economic policy of the state in social area, the second to anti-corruption measures and the third treats issues of improving economic management systems and forming market infrastructure.

According to Mr. Ibadoglu, 60% of the Azeri nationals live beyond poverty margin. The WB is expected to allot $100 million to combat poverty in Azerbaijan till 2015. The Azerbaijan government is to submit its poverty reduction program to the WB before June this year, which will be put to work by 2005.

RUSSIAN GAS SUSPENSION NOT TO TELL ON POWER PLANTS

The suspension of Russian gas imports on April 8 is not going to affect electricity supplies to Azerbaijan's various regions, Azerenergy joint stock company quoted the Central Dispatcher Department as saying Tuesday. This was a planned suspension and the Azerbaijan government has had a range of measures to preclude extreme situations in the energy sector. It has been decided to put the nation's power stations on heating fuel following the establishment of appropriate reserves of the fuel. Some media publications that some of the power plants in Azerbaijan will work on local gas supplies as long as the import gas pipeline is under prophylactic monitoring are erroneous, the source reported. The exception here is the Ali Bayramli regional power station that consumes blue fuel.

STURGEON BREEDING FISHERY TO BE CONSTRUCTED SOON

Construction of a new sturgeon breeding fishery is expected to start in Neftchala in late April, Minister for Ecology and Natural Resources Hussein Baghirov told journalists at the headquarters of the New Azerbaijan Party Friday. Though an agreement on the construction was signed in September last year, negotiations between the World Bank and the winners of the relevant tender lasted a long time. According to the minister, implementing the project will be German Ferrostal and national Azerenergy construction.

The output capacity of the fishery is planned to be 30-35 million young sturgeons a year.

RESERVOIRS' WATER LEVEL EXPECTED TO RISE

Executives from the Ministry of Fuel and Energy and Azerenergy focused on a number of issues, especially flooding in the Mingachevir and Shamkir water reservoirs in a recent meeting.

It was underlined that the water flow in the river Kur in March was far much lower than an optimum level, falling to the lowest mark over the past five years. A normal spring water level in the river used to stand at 40-50 centimeters to only 5-10 nowadays. Subsequently, a sharp fall in the water volume of the river and its tributaries has led to lower electricity generation in power stations they feed. The plants were working to 50-60% of their capacities.

However, experts suppose that water in the inflows to the river and the mentioned reservoirs have recently surged. It inspires optimism that the water level will significantly rise, Azerenergy said.

AZERI ENTREPRENEURS HAVING COURSES IN EGYPT

The Egyptian Foundation for Technical Cooperation with CIS countries is holding agricultural courses "Plant-growing, technologies for processing and marketing of fruits and vegetables", "Development of small and medium agricultural business", "Main economic and political aspects of foreign economic performance of agriculture", and "Egyptian experience in sanitary and veterinary science".

Two groups from the National Confederation of Entrepreneurship Organizations of Azerbaijan have already undergone the courses that started in February this year. A third group of delegates from the confederation is expected to leave for the courses in Egypt from April 14 till May 1.

AZERENERGY REPAYING ARREARS

Accounts payable of Azerenergy joint stock company have made up over AZM7 trillion, while accounts receivable report more than AZM6.5 trillion manat. Work has started to set up a broad database and a common energy computer network to order financial operations. All payments to the budget and Social Security Fund are made in a centralized manner in a bid to intensify financial discipline. Moreover, all settlement accounts have been moved to the International Bank of Azerbaijan and its branches, Azerenegry said Friday.

The company has applied debit cards to pay salaries with active support from the IBA with a view to toughen control over proper use of funds. The cards are expected to cover 2700 employees in the Azerbaijan Regional Power Station first and then spread to all Azerenergy affiliates.

The salary backlog of Azerenergy represents AZM44 billion, but the JSC managed to pay off a fifth of the overall pay arrears in the first quarter of this year. In addition, the level of debtor and creditor arrears was reduced by over AZM20 billion following repayment of mutual debts, according to chief of Azerenergy's planning and financial department Fakhraddin Baghirov.

A coupon system has been introduced to track the use of fuel and lubrication materials that will supposedly prevent abuse of these materials and cut their actual cost, he said.