Heidar Aliyev

President of the Azerbaijan Republic

ADDRESS OF PRESIDENT OF THE AZERBAIJAN REPUBLIC, HIS EXCELLENCY
MR. HEYDAR ALIYEV TO READERS OF THE CASPIAN ENERGY JOURNAL

The first contract opened vast oil and gas possibilities of the Caspian Sea to the whole world. To date, 20 major contracts have been signed in Azerbaijan.

Under the "Contract of the Century," the one on joint development of the Azeri, Chirag, deepwater Guneshli fields located in Azerbaijan's sector of the Caspian Sea, joint cooperation of State Oil Company of the Azerbaijan Republic (SOCAR) with 11 foreign companies was envisaged. The cooperation is being successfully realized and oil was produced at Chirag in 1997. Oil produced from this field is exported to the world's markets. Therefore, we see practical results of the contract we signed.

Naturally, inasmuch as during the contract implementation it was provided for production of huge quantity of oil, it was also essential in the contract to envisage exportation of this oil to international markets. So, it was laid on to build various oil pipelines, including the Baku-Tbilisi-Ceyhan Main Export Pipeline, to export oil produced under the first contract to the world's markets.

Since then, beginning from 1994, we together with the foreign oil companies have done very hard work to establish the Baku-Tbilisi-Ceyhan Main Export Pipeline.

Our work in this direction is known to have fouled with very high resistance, with many obstacles. Many have said that construction of such an export pipeline was unreal. Anyway, for last years the Baku-Tbilisi-Ceyhan petroleum pipeline has been in the highlight of the world public. However, we -- Azerbaijan, Turkey, Georgia, oil companies participating in the consortium -- have been consistently engaged in the issue that concerned construction of the Baku-Tbilisi-Ceyhan oil pipeline, have led and achieved it.

The peak of the whole work is the agreement inked during the Organization for Security and Cooperation in Europe (OSCE) summit held in Istanbul in November 1999. The agreement was signed by Presidents of Azerbaijan, Turkey, Georgia and Kazakhstan. U.S. President Bill Clinton also signed the agreement.

So, our multiyear work ended by approving that political document. However, period passed since then to date has been uneasy, as there have been various views related to the construction, cost and other commercial and technical issues that regarded the Baku-Tbilisi-Ceyhan oil pipeline. These various views have been even among companies-participants of the consortium. That's why, it should be done hard work in this sphere, as well.

Azerbaijan, Turkey, Georgia and their appropriate bodies have carried out this work. The United States of America and its government have also persistently backed the process. Agreements on all technical and commercial issues have been reached. As a result, SOCAR in partnership with the companies joined Azerbaijan International Operating Company (AIOC) has prepared commercial-technical agreements to build the Baku-Tbilisi-Ceyhan Main Export Petroleum Pipeline.

Realization of oil projects allowed to create the favorable way for development of other branches of our economy such as telecommunications, construction, mechanical engineering, agriculture, chemical industry, service and others.

Heidar Aliyev President of the Azerbaijan Republic

"Russia is a great country, it has a great economic, including industrial, potential that is known well. However, today when we are transiting to a new reform implementation system, we see that the most effective sector is the power complex and, first, the oil industry. For Azerbaijan, the oil industry is the anciently leading branch.

Since Azerbaijan went toward the market economy, openness for foreign investments, mutually advantageous cooperation, we have opened up our republic for the entire world. But, considering that Russia and Azerbaijan have been always together, that our economies have inseparably developed, particularly the oil industry, it is emphatically that Russian companies and the Russian power complex should take a special place in Azerbaijan."

Heydar Aliyev,

President of the Azerbaijan Republic