SOCAR could invest in export-oriented non-oil industries - EU

Photo: SOCAR

BAKU, Azerbaijan, October 21. Azerbaijan’s state oil company SOCAR could use its financial resources to invest in export-oriented non-oil industries, reads the “Trade Study Report – Trade Sector Development in Azerbaijan: Policies, Constraints and Opportunities”, issued by the EU.

The report shows that SOCAR Carbamide Plant, SOCAR Methanol, and SOCAR Polymer have made significant contributions to the growth of non-oil exports. These enterprises have enabled the production of higher value-added products instead of the direct export of natural gas.

“The SOCAR Polymer complex in the Sumgayit Chemical Industrial Park, which includes polypropylene and high-density polyethylene (HDPE) plants commissioned in 2018–2019, has played a key role in expanding Azerbaijan’s polymer production capacity. By processing natural gas–derived feedstock domestically and exporting higher value-added polymer products, SOCAR Polymer has significantly contributed to the rising export values of these polymer categories during the 2020–2024 period, further supporting Azerbaijan’s export diversification strategy,” reads the report.

The authors believe that building on this momentum, SOCAR could use its financial resources to invest in export-oriented non-oil industries that extend beyond petrochemicals.

“At the initial stage, this could include, for example, the production of finished polymer-based products (such as packaging, plastic pipes, construction materials, technical plastics, etc.). Subsequently, synthetic fibres for textiles and technical textiles at a higher stage of processing from polymer feedstock; fertilizers and agrochemical products; synthetic rubber and elastomer products used in the automotive, construction, and industrial sectors; and high-tech industrial materials such as carbon fibres and composite materials could be added,” reads the report.

EU believes that such investments would help transform SOCAR’s activities from a raw materials and energy sector focus into a broader industrial and export ecosystem. In this regard, the experience of national oil companies in Kazakhstan (KazMunayGas), the United Arab Emirates (ADNOC), Saudi Arabia (Saudi Aramco), and Malaysia (PETRONAS) in transitioning from oil and gas feedstock to broader industrial and export ecosystems could serve as a direct successful example for SOCAR.