What's at Stake for Whom

At a Glance:

Map of Azerbaijan
CIA map
Azerbaijan—a nation of Turkic Muslims—has been an independent republic since the collapse of the Soviet Union in 1991. Despite a cease-fire, in place since 1994, Azerbaijan has yet to resolve its conflict with Armenia over the Azerbaijani Nagorno-Karabakh enclave (largely populated by Armenians). Azerbaijan has lost almost 20 percent of its territory and must support some 750,000 refugees and internally displaced persons as a result of the conflict. Corruption is ubiquitous and the promise of widespread wealth from Azerbaijan's undeveloped petroleum resources remains largely unfulfilled.

Despite its long history of producing oil, Azerbaijan still possesses considerable oil and gas deposits. Today, four off-shore oilfields produce the lion's share of Azerbaijan's output: "Guneshli," which yields 57 percent of Azerbaijan's current oil production, "Chirag," "Azeri," and "Kapaz." During the Soviet period, these fields were left largely untapped because of the expense and difficulty of drilling at great depths under the sea. Since independence, the Azerbaijan International Operating Company, a twelve-company consortium dominated by BP-Amoco, is developing the three largest Azeri oilfields.

Apart from the development of the oilfields, which has already begun, Azerbaijan continues its explorations for other deposits in the Caspian Sea. In the part of the Caspian belonging to Azerbaijan, around 24 sites have been singled out as suitable for drilling.

Current estimates indicate that Azerbaijan's oil production will exceed 45.2 million tons by 2005, exports are expected to exceed 39.7 tons by 2005.

Population: 7,771,092 (July 2001 est.)
Industries: Petroleum and natural gas, petroleum products, oilfield equipment; steel, iron ore, cement; chemicals and petrochemicals; textiles.
Exports: $1.9 billion, 75 percent oil and gas.
Exports—Partners: Italy, Turkey, Russia, Georgia, Iran
Evironment—current issues: Local scientists consider the Apsheron Peninsula, including Baku, and the Caspian Sea to be the ecologically most devastated area in the world because of severe air, water, and soil pollution.
Economic Trends: Trade with Russia and the other former Soviet republics is declining in importance while trade is building up with Turkey, Iran, UAE, and the nations of Europe. Long-term prospects will depend on world oil prices, the location of new pipelines in the region, and Azerbaijan's ability to manage its oil wealth.

News Agencies: Azer Taj (government-owned), Kabar-Service (government-owned), Baku
Newspapers: Khalg, Azadlyg, Mukhalifat, Hayat, Bakinsky Rabochy, Baku, Aydynlig, Millat, Oghuz Eli, Adalat, Istiglal
The Baku Sun (English-language), Baku

Source: CIA World Factbook