BAKU - Oil output from Azerbaijan is expected to balloon to more than 20 million tonnes in 2005, the president of the state oil company (SOCAR), Natik Aliyev said on Wednesday.
Azerbaijan, which inaugurated the four-billion-dollar Baku-Tbilisi-Ceyhan (BTC) pipeline in May, is expected to see output grow further to 50 million tons per year in 2006 Aliyev said at an oil and gas conference.
The US-backed BTC -- an infrastructure initiative that will allow Caspian Sea producers to get their oil to Western markets without going through Russia -- is expected to handle the excess output.
In 2004 Azerbaijan produced about 15.5 million tonnes of oil.
Output will however slump after 2010 if Azerbaijan does not find new sources of oil or convince producers such as Kazakhstan to commit their crude to the BTC pipeline.
Aliyev said the two former Soviet republics were drafting an agreement on the transport of 20 million tons of oil from Kazakhstan to Baku per year.
The project would require three billion dollars-worth of investment into infrastructure if signed.
But an energy official from Iran told the conference Kazakhstan was also keen on developing routes to the Persian Gulf through the Islamic Republic.
The Director for Caspian Sea Oil and Gas Affairs of Iran's Petroleum Ministry, Mahmood Khagani, said paths through Iran make more economic sense and "the Kazakh government is of the opinion that like a fox, an oilman needs more than one route."
The British oil giant BP holds a leading 30-percent stake in the consortium running the BTC.
David Woodward, the president of BP's Azerbaijan division said the country could earn 160 billion dollars in oil revenues through the operation of its oil contracts if calculated at an average oil price of 40 dollars per barrel.
By 2010 profits from oil sales will equal double Azerbaijan's current Gross National Product, Woodward added
06/08/2005 13:39 GMT