Aliyev: Azerbaijan to produce 20 percent more oil in 2008

Azerbaijan expects to produce 20 percent more oil in 2008 compared with last year, Azerbaijani President Ilham Aliyev said at the Caspian Oil and Gas Conference in Baku this week.

In the first four months of 2008 oil production increased around 14 percent compared with the same period in 2007, according to news agency RIA Novosti. Aliyev said the country will produce 50 million metric tons of oil this year, and 60 million next year.

Aliyev also touted Azerbaijan as having “all the conditions to be a reliable [energy] partner.”

The president underlined that Azerbaijan is part of the Extractive Industries Transparency Initiative (EITI), which aims to encourage better governance in resource-rich countries by publishing company payments and government revenues.

“Azerbaijani society isn’t really concerned how money is spent obtained from the oil industry when it’s absolutely transparent and open for everyone,” the news agency Regnum quoted Aliyev said.

On June 2, representatives from Russia’s gas monopoly Gazprom met Azerbaijani officials to propose a long-term agreement that would see Russia buy Azerbaijani gas at market rates.

“Being a prominent hydrocarbon producer in the CIS countries, Azerbaijan is Russia’s objective partner as we have common interests. We are already linked by a developed gas transportation infrastructure. We are interested in developing the mutually beneficial cooperation between Gazprom and Azerbaijan in the energy sector,” Gazprom official Alexei Miller said when he met Aliyev on June 2.

However, analysts say that Gazprom’s move is an attempt to increase Russia’s grip on the European energy market by limiting its supply of Azerbaijani natural gas.

Baku is involved in projects like the Nabucco pipeline which aim to take Central Asian gas to Europe, circumventing Russia.