Azerbaijan take a big step to reaching gas production targets

Azerbaijan's hopes of increasing its gas production to 50 billion cubic metres (bcm) per year by 2025 took an encouraging step this Christmas, by signing a deal with Turkey that will increase Trans Anadolu flow to 24 billion cubic metres in the medium term.

The deal, worth an estimated $5 billion (£3.2 billion), will carry Azerbaijani gas to European markets via a pipeline to cross Turkish borders, highlighting the country's key role as an energy supply corridor in the region.

A consortium for the construction of the pipeline will be set up between State Oil Company of the Azerbaijani Republic (SOCAR), the state-owned Turkish Pipeline Corporation (BOTAÅž) and the Turkish Petroleum Corporation (TPAO), with third-party international oil and natural gas companies being allowed to join the consortium later during the construction process, which is expected to be complete by 2017.

Turkey and neighbour Azerbaijan have enjoyed strong economic relations in recent years, with both countries enjoying booms in the industry.

Azerbaijani investments in Turkey have reached billions of dollars in size. The most of recent of them was the Star Refinery, a joint oil refinery investment valued at $5 billion between SOCAR and Turkey’s Turcas (SOCAR-Turcas, the largest single private investment realized in Turkey.