Sofaz Says Funds Available to SGC

Azerbaijan's state oil fund Sofaz, a sovereign wealth fund, expects no problems in financing the Southern Gas Corridor (SGC) project in 2017, the fund's executive director Shahmar Movsumov told a press conference in Baku April 18.

“Sofaz didn’t allocate funds for the Southern Gas Corridor in the first quarter of this year. However, funds are envisaged in the annual budget, but the question of whether these funds will be used still remains open. I can say with certainty that the funds for expenditures of the SGC projects are at the disposal of the Southern Gas Corridor closed joint stock company [CJSC]. Therefore, this year there will be no problems with financing,” added Movsumov.

“Moreover, negotiations continue for financing the Southern Gas Corridor in the next two years. I think contracts will be signed by the end of the year and the fund’s Supervisory Board will approve them. So, we don’t expect any problems with the financing of the Southern Gas Corridor,” he added.

Sofaz executive director Shahmar Movsumov (Photo credit: Sofaz)

The state oil fund’s 2017 budget envisages expenditures worth 496.155 million manats (or $290mn) to finance the state’s share in the projects of the Southern Gas Corridor CJSC. 

The Southern Gas Corridor refers to three pipelines projects (the Southern Caucasus Pipeline expansion, the newbuild TANAP across Turkey, and the newbuild Trans Adriatic Pipeline). In a meeting last week with the US ambassador to Azerbaijan, Azerbaijan's energy minister Natig Aliyev said progress was good on the first two but expressed concern about the third and westernmost project, TAP, in Italy. The three projects are meant to flow gas from the BP-led Shah Deniz phase 2 venture to Europe in or around 2020.

Azerbaijan Desk