Azerbaijan's energy sector maintained steady production in 2024, with significant investments directed toward the Shah Deniz gas-condensate field and the Azeri-Chirag-Gunashli (ACG) oil and gas block, according to BP's latest operational report. 

The report reveals that $2.97bn was spent on Shah Deniz operations last year, including $2.20bn in operational expenses and $766mn in capital investments. The majority of these expenditures were related to the Shah Deniz 2 project. Completing the Shah Deniz Alpha (SDA) power supply project in Q4 2024, which connected the platform to the Bravo platform through a subsea current and fibre-optic cable, marked a key milestone. This upgrade eliminated the need for five diesel generators, improving operational efficiency and ensuring a more reliable and cost-effective energy supply.

The Shah Deniz field produced approximately 28bn cubic metres of natural gas in 2024, a 7.7% increase year on year, alongside 4mn tonnes of condensate (around 35mn barrels). The current production capacity stands at 79 mcm per day (nearly 29 bcm annually). The report also notes the commissioning of the third well in the eastern-northern flank under the Shah Deniz 2 project, while activities continued in the western-southern flank.

In 2024, $1.83bn was allocated to ACG operations, including $535mn in operational costs and $1.29bn in capital expenditures. A major development was the successful extraction of the first oil from the new ACE platform in April. The initial oil came from the first well drilled at the platform in late 2023. By year-end, daily output from ACE reached 26,000 barrels per day (bpd).

Throughout the year, ACG maintained stable production, averaging 342,000 bpd or approximately 125mn barrels (16mn tonnes) in total. By December 2024, the block had 148 oil wells, 46 water injectors and seven gas injectors. SOCAR received 2.5 bcm of associated gas from ACG last year, a 25% increase from 2023.

From the inception of Shah Deniz and ACG fields until February 1, Azerbaijan has produced 651.9mn tonnes of oil (including condensate) and 469.6 bcm of natural gas. Of these volumes, 650mn tonnes of oil and 171 bcm of gas were exported.

In January 2025 alone, Azerbaijan produced 2.3mn tonnes of oil, with ACG contributing 1.3mn tonnes, Shah Deniz producing 300,000 tonnes of condensate, and the Absheron field adding 50,000 tonnes. SOCAR's production for the month stood at 600,000 tonnes. Gas production in January reached 3.9 bcm, with 2 bcm from Shah Deniz, 1.1 bcm from ACG, 0.1 bcm from Absheron, and 0.7 bcm from SOCAR.

During the month, 2 bcm of gas was exported, including 1 bcm to Europe, 0.7 bcm to Turkey, and 0.3 bcm to Georgia. Of this, 0.5 bcm was transported via the Trans-Anatolian Natural Gas Pipeline (TANAP).

ACG operations are managed by BP with a 30.37% stake, followed by SOCAR's AzACG (25%), MOL (9.57%), Inpex (9.31%), Equinor (7.27%), ExxonMobil (6.79%), TPAO (5.73%), Itochu (3.65%), and ONGC Videsh Ltd (OVL) (2.31%). The current production-sharing agreement (PSA), initially set to expire in 2024, was extended until 2050 to maximise the field's potential.