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Azerbaijan expects $200bn oil revenue over 15 years

Wed 03 November 2010 11:10 GMT | 16:10 Local Time

Azerbaijan forecasts oil revenues of $200bn over the next 15 years, the head of the State Oil Fund (SOFAZ), Shahmar Movsumov, has said.

He told state-run channel AzTV, "According to forecasts, Azerbaijan's oil revenues in the next 15 years will be $200bn."

These revenues will come from the BP-operated Azeri-Chirag-Guneshli offshore bloc.

"If we take into account past practice, at least half of these revenues will come to the fund," Movsumov said.

"Overall transfers to SOFAZ since its creation [in 2000] amount to $40bn, of which $20bn have been used and the remaining $20bn kept in the fund.

He said that in the past three years the State Oil Fund's assets had grown over 10-fold.

"According to our forecasts, in the next five years the fund’s assets could reach $50bn, if the current oil price on world markets and the level of use of the fund's assets are preserved," he said.

Movsumov believes that the assets of the State Oil Fund might reach $120bn if the conditions are right.

"Overall income from the assets managed by the State Oil Fund topped $1bn in previous years. Meanwhile, considering that the fund's assets will grow in the coming years, a minimum profit from the placement of assets of 5% means we will reach revenues of $6bn per year in 15 years," he said.

The State Oil Fund of Azerbaijan, established in December 1999, accumulates revenue from oil contracts, in particular, from the sale of the state's profit oil, transit tariffs for oil and gas transportation, and the renting of state property.


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