From Shah Deniz to Europe: the growing role of Azerbaijani gas in energy security

Azerbaijan’s access to the European gas market is creating a qualitatively new stage in the country’s energy sector, said Ilham Shaban, head of the Oil Research Center, in his comments to The Daily Baku.

According to the expert, access to European markets has primarily created real opportunities for the rapid growth of Azerbaijan’s gas production. Official statistics clearly reflect this dynamic. Thus, before the Shah Deniz-2 project was commissioned, gas production amounted to 28.6 billion cubic meters in 2017; by 2021 it had risen to 43.9 billion cubic meters, and in 2024 it reached 50.4 billion cubic meters. Over the same period, gas exports also grew significantly, increasing from 8.5 billion cubic meters to 25.3 billion cubic meters.

Ilham Shaban noted that the high liquidity of the European market and the favorable price environment have significantly increased the economic efficiency of large-scale, capital-intensive projects such as Shah Deniz-2. This factor has also created favorable conditions for the development of energy resources located in the deep-water part of the Caspian Sea with complex geological structures.

“In the past five years, the consistent increase in the volume of Azerbaijani gas supplied to the European market is a clear indicator of the practical implementation of the Memorandum of Understanding on a Strategic Partnership in the field of energy, signed between Azerbaijan and the European Union on 18 July 2022. This document confirms how seriously official Baku and its partners approach the commitments they have undertaken.”

According to him, the results achieved are the logical outcome of the deliberate and far-sighted energy policy pursued by President Ilham Aliyev, as well as the coordinated and consistent activities of the project participants. Gas produced from the geologically complex Shah Deniz offshore field makes an important contribution both to strengthening energy stability in the region and to the development of international cooperation.

Ilham Shaban stated that the access of Azerbaijani gas to Europe’s most attractive markets through the Southern Gas Corridor has turned our country into an integral component of Europe’s energy security. In his view, the Shah Deniz project – particularly its second phase – is not only a large-scale production initiative, but also one of the strategic projects that has fundamentally changed Azerbaijan’s geoeconomic position.

The expert added that as a result, Azerbaijan has gained the status of both an initiator of regional energy projects and a reliable strategic partner making a real contribution to Europe’s energy security. The establishment of long-term export and transportation systems, the strengthening of economic ties with transit countries, and the creation of a solid platform for the future expansion of pipelines have ensured the sustainability of Azerbaijan’s gas exports and turned the “big gas era” into a real economic asset.

In conclusion, Ilham Shaban emphasized that these achievements are not only the success of the energy strategy, but also an indicator of the consistent and successful implementation of the strategic concept defined by National Leader Heydar Aliyev and further developed in line with modern challenges by President Ilham Aliyev.