SOCAR's Turkish refinery agrees to supply Istanbul Airport with 700,000 tonnes of aviation fuel annually up to 2028

The Turkey-based STAR refinery of the State Oil Company of the Azerbaijan Republic (SOCAR) plans to supply 700,000 tonnes of jet fuel annually to Istanbul Airport from 2025 to 2027, inclusive, SOCAR Turkiye, the Turkish subsidiary of SOCAR, said Interfax.

"The strategic cooperation should further increase our contribution to the [Turkish] aviation industry," the company said without disclosing any other details.

SOCAR Turkiye also said that it intends to establish producing sustainable aviation fuel (SAF) from vegetable fat waste in line with its development strategy up to 2030.

Meantime, Turkiye Petrol Rafinerileri A.S. (Tupras), which owns four refineries in Turkey, previously reported on social networks that it has agreed to supply 1.8 million tonnes of jet fuel annually to Istanbul Airport over the next five years, starting in 2025. The company obtained the right following a tender held by Turkish Fuel Services, TFS Akaryak?t Hizmetleri A.S., which provides fuel supply services for aircraft at Istanbul Airport, and is the largest distributor of jet fuel in Turkey.

Consequently, Istanbul Airport's annual jet fuel demand is expected to exceed 3 million tonnes this year, of which 23.3%, or 700,000 tonnes, will be supplied by STAR Refinery, and 60%, or 1.8 million tonnes, by Turkiye Petrol Rafinerileri A.S. (Tupras).

STAR Refinery produced nearly 1.26 million tonnes of jet fuel according to 2023 data, and around 840,000 tonnes in January-October 2024.

SOCAR entered Turkey's aviation sector under the SOCAR Aviation brand in 2013, signing its first major contract with Pegasus Airlines for jet fuel supplies at Sabiha Gokcen Airport. In 2016, deliveries began for Turk Hava Yollar? at Ataturk Airport, Izmir Adnan Menderes Airport, and Bodrum Airport.

The STAR refinery was commissioned on October 19, 2018, and is designed to process Azeri Light, Kerkuk, and Urals crude oil. It supplies the Petkim petrochemical complex with raw materials and creates conditions for SOCAR to enter the Mediterranean market with its diesel fuel and jet fuel, as well as raw materials for the chemical industry. The refinery covers 18% of Turkey's needs for petroleum products.

The refinery's capacity to refine oil exceeds 13 million tonnes per year. SOCAR has invested around $7 billion to construct and develop the STAR refinery.

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SOCAR Turkey plans to spend around $7 billion on establishing several new polyolefin production facilities to expand capacity at its Petkim unit, Kanan Mirzayev, head of SOCAR Turkey's refining and petrochemicals division, said on Monday, as per Reuters.

"A detailed front-end engineering design (FEED) for the facilities will be prepared in 2025-2026, requiring around $50 million in initial investments," Mirzayev said.

Petkim is one of Socar's largest assets in Turkey. It is the only integrated petrochemical complex in the country and a key supplier of raw materials for the local industry. The plant's production capacity is 3.6 million tons per year. Total investments in the complex for 2008-2024 amounted to about $2 billion.

Currently, Petkim operates plants for the production of high- and low-density polyethylene, polypropylene, polyvinyl chloride, ethylene glycol, terephthalic acid, aromatic hydrocarbons, plastics and other plants.

We remind, that in May 2024, the state oil company of Azerbaijan Socar and Tatneft signed a new roadmap for cooperation in Kazan.

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BASF SE (Ludwigshafen, Germany) has signed an agreement with Karl Bachl Kunststoffverarbeitung GmbH & Co. KG (BACHL) for the sale of its business with Styrodur, an insulation material made from extruded polystyrene (XPS), said the company.

BACHL is one of the leading manufacturers of insulation materials in Germany, an experienced XPS producer and a long-standing Styrodur distribution partner of BASF. The sale also includes the brand Styrodur. Approximately 50 employees in production, marketing and sales at BASF SE are involved in this business. The affected employees will remain with BASF SE. Subject to the approval of the relevant competition authorities, the completion of the sale is expected by mid-2025. The parties have agreed to keep the financial details of the transaction confidential.

“With the sale of the Styrodur® business, BASF is consistently focusing its strategy on expandable polystyrene with our well-known brands Neopor and Styropor,” said Dr. Klaus Ries, Head of Business Management Styrenics Europe at BASF. Previously, in October 2024, BASF underscored its ambition to continue growing in the European expandable polystyrene (EPS) market with the announcement of an expansion of Neopor production capacity in Ludwigshafen by 50,000 tons to 250,000 tons per year starting in early 2027.

In December 2024, it was announced that BASF had signed an agreement to sell its food and cosmetics ingredients division, along with its production site in Illertissen, Germany, to agricultural commodities trading company Louis Dreyfus.

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Oil transportation through the Caspian Pipeline Consortium's (CPC) system is expected to total 64.4 million tonnes in 2024, which is nearly 1 million tonnes more than the 63.5 million tonnes transported in 2023, Transneft Vice President Vladimir Kalanda said in an interview with the company's corporate magazine, as per Interfax.

The 1,511-km CPC pipeline, connecting oil fields in western Kazakhstan and Russian offshore fields in the Caspian Sea to a marine terminal in Novorossiysk, is the main export route for Kazakh oil, accounting for more than 80% of Kazakhstan's pipeline crude exports. The pipeline can now carry 72.5 million tonnes of crude from Kazakhstan and up to 83 million tonnes through Russia.

We remind, Transneft completed the expansion of its oil transportation capacities towards the port of Primorsk in the Leningrad region in 2024. "The project to expand the oil pipeline in the direction of the port of Primorsk was completed one year ahead of schedule. The project to increase throughput capacity towards the port of Novorossiysk is proceeding rapidly.

The CPC's shareholders are Russia and Transneft with 31%; Kazakhstan with 20.75% (represented by KazMunayGas with 19% and Kazakhstan Pipeline Ventures LLC with 1.75%); Chevron Caspian Pipeline Consortium Company with 15%; Lukoil International GmbH with 12.5%; Mobil Caspian Pipeline Company with 7.5%; Rosneft-Shell Caspian Ventures Limited with 7.5%; BG Overseas Holding Limited with 2%; Eni International N.A. N.V. with 2%; and Oryx Caspian Pipeline LLC with 1.75%.

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Azerbaijan temporarily suspended gas deliveries to Bulgaria for technical reasons as of January 7, Bulgarian gas distributor Bulgargaz EAD reported on its website on Thursday, as per Interfax.

Notification of the suspension of supplies under the long-term contract with Azerbaijan was received on January 6. Supplies are expected to be restored on January 11, the company said.

Bulgargaz said the suspension did not lead to additional expenses on acquiring replacement gas and did not affect the natural gas market in the region.

Such situations again demonstrate the need to diversify supply sources and routes, not only to achieve competitive terms and prices, but also to ensure the reliability of supplies in the event of technical problems, the company said.

Bulgaria has a long-term contract with Azerbaijan for 1 billion cubic meters of gas per year. However, Azerbaijani President Ilham Aliyev said earlier that his country's gas deliveries to Bulgaria would total 1.5 bcm in 2024, which amounts to about half of the country's gas consumption. Bulgaria received 1.25 bcm of gas from Azerbaijan in 2023.

Azerbaijan has gas supply contracts with ten European countries, including Italy, Greece, Bulgaria, Romania, Hungary, Serbia, Slovenia, Croatia, Slovakia and North Macedonia. It has long-term contracts with fixed supply volumes with three countries - Italy, Greece and Bulgaria - and contracts without specific volumes with the others.

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