OREANDA-NEWS. July 24, 2009. The State Oil Fund of Azerbaijan (SOFAZ) has launched to develop 2010 budget.

SOFAZ Chief Executive Shahmar Movsumov reported at a new-conference today that development of SOFAZ budget for 2010 has already been launched.

“For the time being, we do no determine basic for us forecast – the forecast of export cost of oil. Nevertheless, it is possible to confirm that 2010 budget will be conservative,” Sh.Movsumov said.  In accordance with estimations of the SOFAZ management, with preserving existing conjuncture and fulfillment of all obligations on expenses, assets of the fund will increase in 2009 by USD 1-1.5bn as compared to the index of 2008.

For the time being, Azerbaijan oil was sold lower than forecasted for year USD 70 level per barrel, but if at the beginning of year the fund received income from sale of Azerbaijani oil for export on the basis USD 48 per barrel that during last months it exceeded USD 60. The fund expects that prices for oil will increase till the end if year, we will succeed in achieving forecasted USD 70 level per barrel.

On 24 July assets of the fund reached record level at USD 12.187bn.  Following the results of the second quarter it totaled 6.35%, and by 1st July assets of the fund were estimated at AZN   9,557.7 bn (USD 11.886bn). In 2008 the fund achieved increase of its assets by 4.3 times. By 1st January 2009, assets of the Fund reached AZN 8,986.7 mln ((USD 11,219.2 mln).  As a result, by 1st April SOFAZ assets decreased from AZN 8,721.4 mln (USD 10,863.9 million) and finally reached record level.

In 2008 the fund achieved increase of its assets by 4.3 times. By 1st January 2009, assets of the Fund reached AZN 8,986.7 mln ((USD 11,219.2 mln).  As a result, by 1st April SOFAZ assets decreased from AZN 8,721.4 mln (USD 10,863.9 million) and finally reached record level.

By 1st July 2009 revenue of SOFAZ budget totaled AZN 3,156.3mln and expenditures AZN 2,685.7mln

Revenue, connected with from implementation of oil agreements  PSA  type during the first quarter of year made AZN 2,989.3, profit from sale of oil and gas – AZN 2,9076, AZN 5 million transit income, dividends from and AZN 0.1 million from sale of assets received from foreign companies.

The revenue from managing assets of the Fund for half of year amounted to AZN 167 million, and revenue form overestimation of assets in  connection with exchange difference – AZN 100.5 mln.

For this period AZN 20.2 mln was spent to finance improvement of social condition of the population, AZN 61.9 million and AZN 68.5 million were accordingly used for financing the reconstruction of the Samur-Absheron irrigation system and financing construction of the Oghuz-Gabala-Baku water supply system. AZN 1.1mln was directed to financing Baku-Tbilisi-Kars railway and transfer to the Azerbaijan state budget made AZN 2530 mln.

AZN 1.1mln was spent  to finance  “The State program on the education of Azerbaijan youth abroad”. AZN 1,330 million were transferred to the state budget. The Fund’s administrative expenses in this period were AZN 2.7mln

Last year revenue of the Fund made AZN 11,864.7mln or 117% forecast. Expenditures of the Fund totaled AZN 4,291.8mln or 98% forecast.  Revenue from assets management of the Fund made AZN 231.2mln in 2008.