Page 14 - FSUOGM Week 48 2022

FSUOGM NEWS IN BRIEF FSUOGM

Azeri state oil fund suffers $5bn ($418.7mn) and JPY ($118.7mn). in December and 217mn cubic metres
to Transnistria — meaning 406mn cubic
According to the Account of Chambers'
in losses forecast, the volatility observed in the metres, or 13.5mn cubic metres per day, in
total. However, it has been delivering less
oil price in recent years, the reduction of
The State Oil Fund of the Republic of production by fields, as well as the presence than agreed, namely 5.7mn cubic meters per
Azerbaijan (SOFAZ) reported losses from of risks related to the obligation to reduce day since October.
asset management of $2.659bn, or 5.7% production within the framework of Moldova’s state energy trader announced
of its value, as well as extra-budgetary OPEC+, as well as the possibility that the that it already owns a buffer in excess of
expenses amounting to $2.46bn largely due income from the management of the fund's 200mn cubic meters, stored mainly in
to exchange rate appreciation, according assets will not be at the predicted level due Ukraine. This should cover the country’s
to the nine-month performance indicators to the fluctuations and volatility in foreign consumption for nearly two months —
presented to the Accounts Chamber. The financial markets, increases the probability including the consumption in Moldova
budget deficit of SOFAZ is projected at the that the fund's assets will eventually proper only, though, and not the separatist
level of AZN2.4bn for 2023. decrease. Transnistria region.
Meanwhile, SOFAZ revenues for 2023 are SOFAZ, established in December
projected at the level of AZN8.99bn (-43.1% 1999, accumulates revenues from the
of the forecast for 2022), and expenses at implementation of oil contracts, in Naftogaz and Halliburton boost
AZN11.3bn (-1.8%). SOFAZ revenues for particular from the sale of profitable
2023 are calculated from an average oil state oil and gas, transit tariffs for the strategic co-operation
price of $50 per barrel (for 2022 it was $85 transportation of oil and gas through the
per barrel). country, the lease of state property, etc. Naftogaz, Ukraine’s state-owned oil and
According to the draft budget project, gas production company, is increasing
revenues to SOFAZ from the sale of co-operation with Halliburton, one of the
profitable oil and gas in Azerbaijan in 2023 Gazprom admits Moldova paid world's largest oilfield services providers, to
will amount to AZN6.571bn or 73.1% of improve the potential of Ukraine’s oilfields,
the fund's total income. Bonuses to be paid its bills but keeps December Naftogaz said in a press statement on
by oil and gas companies are projected at November 25.
AZN800.7mn, and income received from deliveries low Naftogaz and Halliburton began pro-
the management of SOFAZ assets would be active co-operation in 2018 when the US
AZN1.59bn. Gazprom has announced that Moldovagaz company provided Ukrgasvydobuvannya,
Transit revenues for next year are paid the bills for the natural gas delivered a Naftogaz subsidiary, with sidetracking
projected at AZN23mn, and receipts from in November so it decided “not to reduce services that helped the company increase
oil and gas companies on per-acre payments the volume of natural gas transported to the its production at old wells and depleted
were AZN4.3mn. Republic of Moldova”, reported Deschide. fields.
In the structure of the fund's md quoting a tweet from the Russian gas Currently, Ukrgasvydobuvannya is
expenses for 2023, AZN11.28bn or 99% company. interested in starting the application of
will be transferred to the state budget However, this means that Gazprom will horizontal drilling technology, which
of Azerbaijan. Expenditures for the keep its deliveries to Moldova in December can contribute to a rapid increase in gas
implementation of the State Programme at under half of the contracted amount — production at the fields – both new and
for Improving the Competitiveness of the just like it did in November. those that have been in operation for a long
Higher Education System in Azerbaijan "Company Moldovagaz has eliminated time, the press statement said.
for 2019-2023 are projected at AZN38mn. the irregularities in payments to Gazprom Halliburton provides services and helps
In addition, the costs associated with the for the current supplies of Russian gas in to maximise value throughout the entire
management of the fund are envisaged in November. Gazprom received the money life cycle of a field – from hydrocarbons
the amount of AZN37.1mn, expenses under for gas stuck on the territory of Ukraine localisation and geological data management
the State Programme for the Education of meant for consumers in Moldova," the to drilling and formation evaluation, well
Azerbaijani Youth in Prestigious Foreign company said according to Prime news construction and completion as well as
Higher Educational Institutions for 2022- agency. production optimisation throughout the
2026 tab are AZN36.7mn. "In this context, a decision was made asset's life cycle.
Earlier, in 2022, the revenues obtained not to reduce gas supply to the Sudzha gas Ukraine’s gas industry has taken a major
from the management of the State Oil metering station for transit to Moldova." hit due to Russia’s invasion of Ukraine.
Fund's assets were initially predicted to be Gazprom also warned Moldova to pay Ukrgazvydobuvannya was forced to freeze
1.7% or AZN1.2bn, but later, taking into its future gas bills in time, or else the gas certain facilities in the Kharkiv region in
account the processes occurring in the deliveries will be terminated. March due to the intense fighting.
market and the resulting uncertainties, the “Due to Moldova’s frequent payment However, it is now resuming operations
expected profitability in the honest budget breaches,” Gazprom said it “reserves the as quickly as possible. The company
was determined as 0%. According to the right to cut or stop exports in case of managed to launch a well in the Kharkiv
monthly performance indicators, it was further problems”. Region with a production rate of more
reported that there was a loss of AZN4.5bn It’s a surprising statement, given that than 140,000 cubic metres of gas per day
or 5.66% from the management of funds. the party that is breaching the contract is last month and drilled a record volume
As of the reporting date, the fund's Gazprom. of new wells, achieving 30,222 metres in
extra-budgetary expenses amounted to Gazprom previously announced its September.
$2.4bn, including $447.8mn for gold, deliveries will be 56% of the contractual “Drilling of new wells has the most
and $2bn for the difference caused by terms in December, citing technical significant and sustainable impact in terms
exchange rate changes. The main share of problems in Ukraine. of providing the country with its own
the negative return on the difference arising Under the contract signed in 2021, Ukrainian gas,” the company cited acting
from the change in exchange rates was Gazprom is supposed to deliver 189mn CEO Oleksandr Romaniuk as saying.
on the portfolios of euro ($1.24bn), GBP cubic metres of gas to Moldova proper

P14 www. NEWSBASE .com Week 48 02•December•2022