Azerbaijan's $10.8bn forum: one firm gas decision and many options

Azerbaijan's second International Investment Forum, which closed in Baku on 26 September, ended with a headline number and one hard decision. The Economy Ministry says 23 documents covering projects worth a combined $10.8bn were signed. Reuters, quoting a presidential aide, put the total at more than $10bn. The hard decision was the final investment decision on the full development of the Absheron gas and condensate field. Most of the rest, as JAMnews points out in its analysis of the package, consists of frameworks, memoranda and production-sharing terms whose value depends on exploration results and further negotiations. This report sets out what was agreed, what it adds to Azerbaijan's gas balance, and where the limits lie.

Absheron: the one binding commitment

TotalEnergies, which operates Absheron with a 35% stake alongside SOCAR (35%) and Abu Dhabi's XRG (30%), announced the decision on 26 September. The field lies about 100 km south-east of Baku and holds approximately 140 bcm of recoverable gas, according to the company. A first phase with a capacity of 1.5 bcm a year and 12,000 barrels a day of condensate has been producing since 2023. Full-field development will lift total output to 6 bcm a year and 47,000 barrels a day of condensate, with start-up expected in 2029.

SOCAR has filled in the cost and engineering detail. Its vice president, Babak Huseynov, told Report that total capital investment is estimated at about $4.2bn. The programme includes four subsea production wells, a multiphase offshore pipeline about 142 km long and new processing facilities at Sangachal. At plateau the new phase is to add about 12.7 million cubic metres a day, or roughly 4.5 bcm a year, plus 35,000 barrels a day of condensate on top of phase one. Huseynov said the recovery rate should exceed 60% and that the task now is "absolutely concrete - to achieve first gas in 2029".

The figures differ slightly depending on who is speaking. President Ilham Aliyev told the forum that the project would raise national gas production by around 5 bcm within three to four years. JAMnews notes that the operator's own numbers imply an increase of 4.5 bcm a year. TotalEnergies says the gas will go to the domestic market and to Turkey through the existing infrastructure that connects Azerbaijan to Europe; it does not name European buyers.

ExxonMobil, Comstock and the memoranda

The second energy headline was a production-sharing agreement between SOCAR and ExxonMobil for exploration, development and production of unconventional hydrocarbons in the onshore Middle Kura Basin. Each company holds 50% through subsidiaries, and ExxonMobil is operator, SOCAR said. JAMnews notes that Bloomberg has linked the project to shale oil and gas, and that it reportedly still awaits parliamentary approval. Aliyev said success "could lead to another oil and gas boom in Azerbaijan". No timetable, budget, reserve estimate or size of the contract area has been published. SOCAR's president, Rovshan Najaf, said in March that onshore unconventional resources had not been a priority before and that US companies were natural partners because they have the technology.

Other SOCAR documents point outward rather than into Azerbaijan's own geology. Rigzone lists the main ones:

• A framework agreement with Comstock Resources under which SOCAR would invest $1.65bn in Haynesville shale assets in the United States and explore liquefying and marketing Comstock's share of the gas outside the US. Comstock expects a definitive sale agreement by 31 October and closing by the end of 2026.
• A memorandum with Apollo on evaluating and structuring potential investments by Apollo-managed funds in SOCAR's upstream interests.
• A memorandum with Securing Energy for Europe (SEFE) on gas and LNG supply, infrastructure and upstream investment.
• An agreement with Germany's VNG setting a framework for a possible long-term partnership in gas, infrastructure and hydrogen.

JAMnews concludes that no full breakdown of the $10.8bn has been published, nor a financing timetable, and that "there is therefore no basis for treating the entire amount as a guaranteed inflow of foreign investment". That is a fair reading. Of the energy items, only Absheron has a funded schedule.

A flat base under the new projects

The forum's announcements come against output that is not growing. According to the State Statistics Committee, as reported by Trend, Azerbaijan produced 33.4 bcm of gas in January–August 2026, 0.5% less than a year earlier; commercial production fell 0.9% to 25.6 bcm. Customs data show exports of 16.37 bcm of pipeline gas worth $5.7bn over the same period, down 0.5% in volume and 4.8% in value. Gas made up 26.18% of total exports.

Reuters reports that Azerbaijan exported about 25 bcm last year, roughly half of it to EU countries, and that further growth in exports to Europe would require more pipeline capacity. XRG, which completed the purchase of a stake in Southern Gas Corridor CJSC in mid-September, describes the corridor's capacity as up to 26 bcm a year. Absheron's additional gas is therefore likely to help hold exports steady and meet domestic demand before it adds to European supply on any scale. Aliyev linked renewable power to freeing gas for export by reducing domestic consumption.

The queue of buyers

Demand is not the constraint. On the sidelines of the forum Azerbaijan held another round of talks with Slovakia, News.az reports; Slovakia is expected to start buying after 2027, at about 1.2 bcm a year. Azerbaijan's energy minister, Parviz Shahbazov, discussed gas supplies to Germany with the German ambassador, the ministry said in a statement reported on 22 September. Moldova raised the diversification of gas and petroleum product supplies at the UN General Assembly. Azerbaijan has also been sending gas to Syria through Turkey since August 2025, with 728.38 million cubic metres exported in January–July this year, according to state statistics cited by News.az.

Each of these customers adds a contract claim on a supply that is flat until 2029. The SEFE and VNG memoranda suggest that German buyers want a position in the queue now. Whether they get gas sooner depends on decisions that were not taken in Baku last week: expansion of the Trans Anatolian and Trans Adriatic pipelines, and long-term contracts large enough to finance it.

What to watch

• Parliamentary ratification of the ExxonMobil production-sharing agreement and any disclosure of the Middle Kura contract area, work programme or budget.
• Whether the Comstock purchase agreement is signed by 31 October, which would be SOCAR's largest upstream step outside its home region.
• Whether the Slovak and German talks turn into supply contracts with dates and volumes, or remain statements of intent.
• Contract awards for the Absheron subsea and Sangachal onshore works, which will show whether the 2029 start-up date is holding.

The forum confirmed Azerbaijan's own description of its economy. Aliyev said oil and gas still make up more than 90% of exports and will "retain a leading role"; by JAMnews' calculation from customs data the share of goods exports was 71.22% in January–August. Absheron extends that model by a decade. The ExxonMobil and Comstock deals are a bet that SOCAR can extend it further, onshore at home and as a gas trader abroad. Neither will change the volumes Europe receives before the end of this decade.

Sources

• TotalEnergies — Azerbaijan: TotalEnergies announces Final Investment Decision for Absheron Full Field Development
• Report.az — Babak Huseynov: Full-field development of Absheron to require investment of $4.2B
• Global Banking & Finance Review (Reuters) — Azerbaijan signs investment agreements worth more than $10 billion
• JAMnews — SOCAR, ExxonMobil sign deal to explore for oil and gas in Azerbaijan's Middle Kura Basin
• Trend — ExxonMobil to become operator of project to develop Azerbaijan's unconventional hydrocarbons
• Rigzone — SOCAR Expands International Partnerships
• Trend — Azerbaijan's natural gas output exceeds 33B cubic meters in 8M2026
• Gulf News — XRG completes Southern Gas Corridor deal, expanding Caspian gas route to Europe
• News.az — Azerbaijan maintains its position as a key gas exporter
• Caliber.Az — Baku, Berlin discuss Azerbaijani gas supplies to Germany