Azerbaijan’s state oil fund SOFAZ expects the revenues from the management of assets to be slightly higher in 2018 than in 2017, a source in SOFAZ told Trend and Azernews.
SOFAZ budget for 2018 was projected with the oil price taken $45 per barrel, as against $40 for the last year, said the source.
“Still, this figure represents very prudent downside risk estimation, since given the latest oil market trends it is highly probable that the actual annual price will in fact be higher,” said the source. “In January 2018, SOFAZ also received a payment of $450 million bonus for the extension of the production-sharing agreement on Azeri-Chirag-Guneshli oilfield; also, revenues from the management of SOFAZ assets are expected to be slightly higher than in 2017.”
In view of these facts, it is realistic to expect that SOFAZ’s budget revenues projected at 11.56 billion manats, will be fully executed, noted the source.
“It should be mentioned that in 2017, actual results of the year far exceeded expectations, and the Fund’s assets, instead of decrease, registered an increase from $33.1 billion to $35.8 billion. This year, SOFAZ budget surplus is estimated to constitute 1.8 billion manats,” said the source.
Based on SOFAZ's regulations, its funds may be used for construction and reconstruction of strategically important infrastructure facilities, as well as solving important national problems.
The main goals of the State Oil Fund include: accumulation of resources and placement of the Fund's assets abroad in order to minimize the negative effect on the economy, the prevention of "Dutch disease" to some extent, promotion of resource accumulation for future generations, and support of current social and economic processes in Azerbaijan.