NO PROBLEMS WITH SOCAR’S SHARE FINANCING IN “SHAHDENIZ” PROJECT

According to SOCAR president Natig Aliyev, the Company has no problems with financing its share in the project “Phase-1” developing “Shahdeniz” field.

He stated that the European Bank for Reconstruction and Development has guaranteed to allot a credit for financing SOCAR’s share and preliminary agreement with its Credit Department has been reached. EBRD is expected to make a decision regarding the credit by the end of 2003.

As is known, EBRD will allot $200 million to SOCAR for “Shahdeniz” project, $100 million out of which will be allocated by EBRD, while the rest - by private banks.

Currently, SOCAR finances its share by itself. To this end, a special account has been opened to where the income from development of field “Azeri-Chirag-Guneshli”, from sale of profitable oil from “Chirag” is transferred.

By late 2003, SOCAR will allocate $40 million from its funds for the first phase of “Shahdeniz” field development.

Project “Phase-1” costs $3,2 billion from which $2,3 million will be spent on exploration of the field and gas extraction, while $0,9 billion - for Baku-Tbilisi-Erzerum construction.