AGP Executive Report

Clean-Energy Links: Azerbaijan, Georgia, Türkiye and Bulgaria signed a pact at COP31 to expand cross-border electricity lines and clean-power exports to Europe. Baku is also discussing corridor plans with Bulgaria, ACWA Power and Vestas, including new wind and solar projects and grid integration. Oil and Gas: The EIA held its 2027 oil-output forecast at 530,000 barrels a day. Associated gas production rose 4.1% in January–September. SOCAR is expanding its Türkiye operations, including a $120 million jet-fuel unit and an 850,000-tonne polyethylene plant, and has strengthened cooperation with China’s Sinopec. Industrial Growth: Investment in Karabakh industrial parks has exceeded $132 million. Aghdam industrial sales reached AZN 2.96 billion as new factories opened, including metal-products and mattress plants. A $100 million agropark in Zangilan is expected to create 500 jobs.

Clean Energy Corridor: Azerbaijan, Türkiye, Georgia and Bulgaria signed a strategic partnership at COP31 to develop cross-border clean-power trade and link Azerbaijan’s renewable generation with Turkish and European markets. SOCAR Projects: SOCAR selected US technology for a planned 850,000-tonne-a-year polyethylene plant in Türkiye and is investing $120 million in a STAR refinery unit that will add about 600,000 tonnes of annual diesel capacity. COP31 Energy Agenda: Azerbaijan presented its low-carbon hydrogen prospects and called for clean-power generation to advance alongside grid upgrades and storage. Oil Outlook: The US EIA raised its 2027 forecast for Azerbaijan’s oil output by 10,000 barrels a day to 530,000. Aghdam Industry: Sales at the district’s industrial enterprises reached 2.96 billion manats as new factories boosted activity; investment in industrial parks has exceeded $132 million.

Energy Partnerships: SOCAR and China’s Sinopec signed a strategic cooperation framework in Shanghai, focusing on procurement and supply chains and drawing on Sinopec’s engineering, refining and manufacturing expertise. Renewables: At COP31, Azerbaijan highlighted 157 GW of offshore wind potential in its Caspian waters and called for investment, long-term power agreements and a predictable business environment. The country aims for renewables to reach 43% of installed power capacity by 2035. Industrial Growth: Aghdam industrial sales reached AZN2.96 billion as new factories boost output. Recent openings include metal-products and orthopedic-mattress plants, with investment in the district’s industrial parks topping $132 million. Fuel Production: Premium gasoline output fell 65.6% in the first nine months of 2026, pointing to a sharp shift in domestic fuel production. Regional Business: Azerbaijan and Serbia discussed expanding trade and investment, with cooperation opportunities in energy, transport, logistics, industry and agriculture.

Green Energy: Azerbaijan’s COP31 pavilion in Antalya is promoting the country as a clean-energy link between Central Asia and Europe. A four-country consortium has also applied for EU recognition of a proposed undersea power cable linking Azerbaijan, Georgia, Romania and Hungary. Energy Partnerships: SOCAR and China’s Sinopec signed a cooperation memorandum covering procurement, supply chains and the exchange of expertise. Azerbaijan’s associated-gas production rose 4.1% in January–September, while premium gasoline output fell 65.6%. Industrial Growth: Investment in the Aghdam and Araz Valley industrial parks has reached $132.35 million. Aghdam’s industrial sales reached 2.96 billion manats as new factories came on stream. Circular Economy: Azerbaijan plans to build biogas plants to process organic waste.

Energy: Azerbaijan produced 11.676 billion cubic metres of associated gas in January–September, up 4.1% year on year. Agriculture: A $100 million integrated agropark planned for Zangilan is expected to create 500 jobs across farming, livestock breeding and food processing. Connectivity: Azerbaijan, Armenia and the United States have launched technical planning groups for transport links and electricity transmission under the TRIPP project. Manufacturing: New metal-products and orthopedic-mattress facilities have opened in Aghdam, while a beverage plant was inaugurated in Jabrayil. Energy investment: SOCAR signed a global framework agreement with Honeywell and agreed a $1.65 billion deal to acquire stakes in US Haynesville gas projects.

Energy Links: Russia and Iran are considering gas supplies routed through Azerbaijan as an interim step toward a proposed pipeline. Its initial capacity could reach 55 billion cubic metres a year. Transport & Power: Azerbaijan, Armenia and the United States launched technical groups for the TRIPP corridor, focusing on transport links and electricity transmission. Karabakh Industry: A metal-products plant and an orthopedic-mattress factory opened in Aghdam, as reconstruction brings new manufacturing capacity to the district. Energy Investment: SOCAR signed a global framework agreement with Honeywell and agreed to acquire stakes in US Haynesville gas projects for $1.65 billion. Trade: China-Azerbaijan trade turnover hit a record $3.46 billion, while Azerbaijan and Ukraine adopted a plan to expand economic cooperation in 2026–27.

Energy Outlook: Azerbaijan’s draft 2027 budget forecasts Shah Deniz gas output slipping 0.7%, with project profit-tax revenue down 11.3%. Transport and Power: Azerbaijan, Armenia and the United States have launched technical groups to advance the TRIPP corridor, focusing first on transport links and electricity transmission. Industrial Growth: New facilities opened in Aghdam, including a metal-products plant and an orthopedic mattress factory; Aliyev also reviewed the district’s olive enterprise. Energy Investment: SOCAR signed a global framework agreement with Honeywell and agreed to acquire stakes in U.S. Haynesville gas projects in a $1.65 billion deal. Agriculture: Azerbaijan is targeting more than double its aquaculture output by 2030, following Baku’s first regional aquaculture forum. Supply Risks: Türkiye’s finance minister warned that the Middle East conflict is intensifying energy-market disruption and pushing countries to diversify trade routes and reduce strategic dependencies.

Regional Connectivity: Azerbaijan, Armenia and the United States launched technical groups to advance the TRIPP route, focusing first on transport infrastructure and electricity transmission. Aghdam Industry: Two factories opened in Aghdam Industrial Park: a mattress plant with annual capacity of 130,000 units and a metal-products facility backed by a 24.9 million-manat investment. The Aghdam Olive Enterprise has planted more than 700,000 trees across 1,150 hectares and plans annual output of 10,000 tonnes of olives or 2,000 tonnes of olive oil. Energy: SOCAR and Honeywell signed a framework agreement to expand energy cooperation. Marketable associated-gas production rose 7.8% year-on-year in January–September, while Shah Deniz gas output is forecast to dip 0.7% in 2027 and project profit-tax revenue to fall 11.3%.

Aghdam Manufacturing: Two plants opened in Aghdam Industrial Park: a 24.9-million-manat steel-products facility and a mattress factory with annual capacity of 130,000 units, including products for export. Agriculture: Aghdam’s olive enterprise has planted more than 700,000 trees across 1,150 hectares and targets annual output of 10,000 tonnes of olives. Energy Investment: SOCAR signed a global framework agreement with Honeywell covering digitalisation, automation and technology across its assets; separately, SOCAR agreed to buy stakes in US Haynesville gas projects in a $1.65-billion deal. Oil and Gas: Azerbaijan’s Chirag platform has produced 107.8 million tonnes of oil and 25 billion cubic metres of gas since 1997. In January–September, gas condensate output fell 10% year on year, while marketable associated gas production rose 7.8%.

Energy: Azerbaijan’s parliament is set to approve revised terms for the Absheron offshore block involving SOCAR, TotalEnergies and ADNOC. Separately, SOCAR signed a $1.65 billion deal to acquire stakes in US Haynesville gas projects. Trade & Logistics: Azerbaijan and Ukraine adopted a 2026–27 economic cooperation plan covering energy, transport and investment; Kyiv also proposed preparing routes linking Azerbaijan to Ukraine and Europe. Kazakhstan’s polymer shipments to Mexico via Azerbaijan show the Middle Corridor’s reach, while Russian Railways is offering discounts on selected exports routed through Azerbaijan. Industry & Reconstruction: President Ilham Aliyev opened a non-alcoholic beverage production facility in Jabrayil, part of ongoing investment in the liberated territories. Agriculture: Azerbaijan’s first regional aquaculture forum put the sector’s growth and sustainable fisheries on the agenda, as the country targets more than doubling aquaculture output by 2030. Business Climate: Azerbaijan expects tax concessions and exemptions to total AZN 7.6 billion in 2027; proposed measures include a six-year VAT exemption for tractor sales and spare-parts imports.

Manufacturing: President Ilham Aliyev opened Sunbeverage’s non-alcoholic drinks plant in Jabrayil, adding production capacity to a district undergoing industrial revival. Energy Investment: SOCAR agreed to pay $1.65 billion for stakes in US Haynesville gas assets, expanding its international portfolio. Azerbaijan also reported $5.7 billion in gas export revenue for January–August. Trade & Clean Energy: China-Azerbaijan trade reached a record $3.46 billion in January–September; a Chinese-built 100 MW solar plant is connected to Azerbaijan’s grid, and a major wind farm has been completed. Regional Logistics: Kazakhstan plans to ship 1.7 million tonnes of oil through the Baku-Tbilisi-Ceyhan pipeline in 2027. Azerbaijan and Ukraine also adopted a 2026–27 action plan covering trade, energy and transport cooperation.

Energy & Exports: Kazakhstan plans to ship 1.7 million tonnes of oil through the Baku-Tbilisi-Ceyhan pipeline in 2027, up from 1.6 million tonnes expected this year; Azerbaijan says it can take up to 2.2 million tonnes annually. SOCAR has also signed a $1.65 billion deal for stakes in US Haynesville gas projects, while Azerbaijan reported $5.7 billion in gas export revenue for January-August. Transport & Trade: Azerbaijan and Kazakhstan are advancing Caspian logistics projects, including a ferry system and a Baku cargo terminal, as the Middle Corridor gains momentum. Agriculture & Food: Baku’s first regional aquaculture forum set a target to lift annual output from 3,400 to 7,700 tonnes by 2030; Azerbaijan and FAO also discussed digital food-safety systems and joint projects. Industry & Investment: New measures include a proposed five-year 8% simplified tax for domestic freight carriers and a six-year VAT exemption for tractor sales and parts imports. Shafag solar farm installation in Jabrayil has reached 50%, while electrification work at Sangachal Terminal is 90% complete.

Tax & Industry: Proposed six-year VAT and customs-duty exemptions for tractor sales and parts aim to boost local production from 2027. Other proposals would offer domestic freight carriers an 8% simplified tax and abolish fees for veterinary certificates. Aquaculture: Azerbaijan aims to more than double annual output to 7,700 tonnes by 2030. At Baku’s first regional forum, FAO urged sustainable fisheries management and protection of water resources. Energy: SOCAR agreed to acquire minority stakes in US Haynesville gas assets for $1.65 billion. Azerbaijan forecasts 2027 gas production of 16.3 billion cubic metres and diesel output up 5%. Reconstruction & Transport: State investment in Karabakh and East Zangezur is projected to reach $22.82 billion by 2030. Kazakhstan and Azerbaijan are advancing a joint cargo terminal and Caspian ferry system to expand Middle Corridor freight links. Clean Power: Azerbaijan, Bulgaria, Georgia and Türkiye are moving toward a partnership to develop cross-border clean electricity transmission.

Caspian Logistics: Azerbaijan and Kazakhstan agreed to establish a joint cargo terminal and the “Caspian Bridge” ferry system, boosting Middle Corridor capacity. Kazakhstan is also considering shipping up to 500,000 tonnes of wheat to Israel via Azerbaijan and Georgia. Clean Energy: Azerbaijan, Bulgaria, Georgia and Türkiye approved a draft agreement to advance cross-border clean-electricity transmission and related infrastructure. Oil and Gas: bp reported $3.08 billion in Shah Deniz spending in the first nine months of 2026, while Sangachal Terminal electrification reached 90% completion. Renewables: Installation of solar modules at the Shafag plant in Jabrayil is halfway complete; 444 local workers are on the project, including 150 resettled residents. Industry and Investment: Azerbaijan plans AZN 434 million for Heydar Aliyev Oil Refinery modernization in 2027. Non-oil revenues are projected to make up 60.6% of next year’s budget. Digital Cooperation: Azerbaijan and Estonia agreed to expand work on AI, digital government, innovation, transport and logistics.

Budget and Diversification: Azerbaijan’s 2027 draft budget projects non-oil and gas revenues at a record 60.6% of total revenue, or AZN 23.8 billion. It also sets aside AZN 434 million to modernise the Heydar Aliyev Oil Refinery. Oil and Gas: BP says the first well under the ACG non-associated gas project is producing, while Shah Deniz work continues amid rising costs. The budget package warns lower oil prices could weaken revenues and SOFAZ assets, projected at $78.3 billion by 2030. Industry: Aghdam Industrial Park’s safety-footwear producer is expanding exports, with orders and agreements spanning Kazakhstan, Albania and Canada. Trade and Logistics: Azerbaijan and Kazakhstan are advancing Caspian ferry and intermodal terminal plans, while SOCAR and KazMunayGas discussed drilling cooperation, including possible deployment of Kazakhstan’s Satti rig at Azerbaijani offshore fields. Regional Investment: Azerbaijan and China are exploring a joint industrial park alongside infrastructure projects.

Energy: SOCAR and Kazakhstan’s KazMunayGas discussed expanding Kazakh oil shipments through Azerbaijan, while an IEA report expects Azerbaijani gas deliveries to the EU via TAP to remain near capacity this winter. Transport: Azerbaijan and Kazakhstan signed cooperation agreements for a Caspian ferry system and a joint cargo terminal at the Port of Alat, targeting 8 million tonnes of annual capacity, with scope to increase it. Azerbaijan Railways also met major shippers to discuss freight reforms and infrastructure upgrades. Industry: Baku and Beijing explored a joint industrial park, with Chinese construction firm CSCEC International among the potential partners. Business Links: An Italy–Azerbaijan forum in Baku on November 23 will focus on energy, infrastructure, advanced industry, AI, agriculture and critical raw materials. Tourism: Azerbaijan promoted its travel and events offer to industry representatives in Jordan and China, seeking new commercial partnerships.