Azerbaijan state energy firm SOCAR plans IPO of Turkish unit, eyes HK bourse too

Photographer: Anthony Kwan/Bloomberg

Azerbaijan’s state energy company SOCAR plans to list its Turkish subsidiary on the London, Hong Kong and Istanbul stock exchanges in 2021, a SOCAR official said.

“We believe that we have a good asset that we can monetise and IPO is a profit for shareholders,” Zaur Gakhramanov, head of SOCARTurkey Enerji, told Reuters at the annual Caspian Oil and Gas conference in Azerbaijan’s capital Baku.

He did not specify the volume of shares in SOCAR Turkey Enerji that SOCAR planned to offer to investors, but said that shareholders and SOCAR‘s management would decide how to use proceeds from the initial public offering (IPO).

Citigroup and JP Morgan will be listing consultants, while McKinsey will help with “technical and financial optimisation”.

Gakhramanov said that SOCAR‘s STAR oil refinery in Turkey had reached its full processing capacity of 10 million tonnes of oil per year in May and was expected to process 7 million tonnes of crude by the end of 2019.

“The plant is currently processing 28,500–29,000 tonnes of crude oil daily,” he said, adding that the same volumes would be processed in June and July.

Oil products from the refinery are sent to the Turkish domestic market as well as for export.

Gakhramanov said that STAR would export 300,000 tonnes of reformate and 50,000 tonnes of jet fuel this year, while exports next year were expected to rise to 600,000 tonnes of reformate and 200,000-250,000 tonnes of jet fuel.

Gakhramanov said that reaching its full capacity enabled STAR to add other grades of crude oil to Urals, the only grade that it had been refining so far.

“We plan to purchase 600,000 barrels of Siberian light crude and oil from Iraq Basra in June for processing purposes as it is possible to refine all crude oil grades at our plant,” he said, adding that Saudi oil was not commercially profitable for the company at the moment.

Gakhramanov said that SOCAR had been given final permissions for the acquisition of natural gas distributing networks in the Turkish industrial cities of Kayseri and Bursa from Germany’s EWE Turkey Holding on May 27 and would finalise the deal by mid-June.

The company expects to be distributing 4 billion cubic metres (bcm) of gas to consumers in Turkey from 2020.

Gakhramanov said that gas supplies from Azerbaijan’s giant Shah Deniz field to Turkey through the Trans-Anatolian Pipeline (TANAP) would reach 3 bcm in 2019 and would double from 2020.

Reuters

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.