Spring 1999 (7.1)
Page 94

SOCAR Section
Statoil - On Its Own

On February 14, 1999, Statoil's alliance with British Petroleum (BP) was officially terminated due to the merger between BP and Amoco. Since January 1999, Statoil has begun to position itself as a major player in Azerbaijan's oil and gas industry. After BP Amoco, Statoil is the largest foreign oil company in Azerbaijan, if measured by investment in anticipated oil reserves, such as in AIOC (8.56%), the Shah Daniz prospect (25.5%) and the Alov prospects (15%). Statoil and BP were the first foreign companies to establish an office in Azerbaijan, back in 1992.

Statoil's leadership meets President Aliyev: (l-r) Kjell O. Kran (Chairman of the Board), Harald Norvik (President and CEO) and Ellen Mo (Deputy Chairman of the Board).

Statoil hopes to maintain a leading position among the foreign companies in Azerbaijan well into the next century to become an operator of new offshore oil fields and pursue a leading role in oil transportation systems and the gas industry.

Statoil was the first foreign oil company to undertake a major gas industry study in Azerbaijan, a project carried out jointly with SOCAR and Azerigaz in 1997. At present, Statoil is carrying out a feasibility study on commercial gas utilization in Azerbaijan jointly with BP, SOCAR and Azerigaz.

Statoil's investments in Azerbaijan in 1999 are expected to reach $60 million and will more than double the following year. From a $300 million investment level in 2001, Statoil's yearly investments are expected to average $400 million from 2001 until 2008, based on the present portfolio of upstream projects but excluding potential investments in midstream and downstream projects.

Focus on Children
Statoil has been a leading company in terms of scope and volume of humanitarian support in Azerbaijan. Many of its projects have been sponsored jointly with BP. For example, Statoil helps sponsor psycho-social trauma rehabilitation projects for refugee children from the Khojali and Shusha regions under the direction of the Norwegian Refugee Council.

Statoil is also building a school for refugees in Mingachevir, in the North Central region of Azerbaijan, with Children Aid Direct. For the past four years, Statoil has funded rehabilitation projects and support for Internat No. 3 in Mardakan, an orphanage for mentally handicapped children. Many wives of Statoil employees volunteer at the orphanage twice a week, caring for the children and providing medicine, food and clothing.

Statoil has been involved with rehabilitation projects with orphanages for the past four years.

Statoil, a Norwegian State-controlled oil company, was established in 1972 and has experienced unprecedented growth into a fully integrated oil company and works in 27 countries. Statoil is Europe's largest oil producer and one of the largest oil traders in the world. It has constructed and operates the world's largest sub sea gas trunking systems, contracted to supply Europe yearly with 75 billion cubic meters of Norwegian offshore gas beginning in 2005.

Since early January, Statoil has moved out of the jointly owned alliance office in Mirza Mansur Street in Baku's "Inner City" and established itself in the modern downtown Landmark complex. The company has 45 employees, of which 70 percent are Azerbaijanis.

From Azerbaijan International (7.1) Spring 1999.
© Azerbaijan International 1999. All rights reserved.

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