Flames shoot into the sky from a sandstone outcrop on a hillside of the Absheron peninsula near Baku, the capital of Azerbaijan, as it gets ready to host the COP29 climate conference.
The “burning mountain,” known as Yanardag in Azerbaijani, is fueled by underground gas that rises to the surface and ignites upon contact with oxygen.
Due to the abundance of naturally occurring fires from the country’s vast gas deposits, Azerbaijan has earned the nickname “The Land of Fire”.
Azerbaijan’s significant oil and gas resources have played a major role in shaping the country’s history, culture, politics, and economy, according to energy expert Kamalya Mustafayeva.
The country’s oil reserves, totaling 7 billion barrels, were first discovered in the mid-19th century, making Azerbaijan one of the earliest commercial oil producers in the world.
“Azerbaijan drilled the world’s first industrial onshore oil well, as well as the first offshore one,” stated Ashraf Shikhaliyev, the director of the energy ministry’s international cooperation department, in an interview with AFP.
– ‘Born of oil boom’ –
Since gaining independence from the Soviet Union in 1991, Azerbaijan has produced 1.05 billion tonnes of oil and plans to increase its natural gas production from 37 billion cubic metres (bcm) this year to 49 bcm over the next decade, as per official figures.
Revenue from oil and gas production accounts for about 35 percent of the country’s GDP and nearly half of the state budget.
“Azerbaijan’s oil revenues, totaling up to $200 billion since 1991, have enabled the country to progress significantly,” stated Sabit Bagirov, former head of the State Oil Company of Azerbaijan.
“Baku, originally a small fishing village with around 4,000 inhabitants, grew rapidly during an oil boom,” leading to a population surge faster than that of London, Paris, or New York from the 1890s, explained energy expert Ilham Shaban.
Today, modern Baku is a bustling city with skyscrapers, waterfront promenades, and futuristic architectural marvels designed by renowned architects.
The capital has become a hub for major international events, including the Eurovision Song Contest in 2012, Euro 2020 football matches, and the Formula 1 Grand Prix.
With the help of petrodollars, Azerbaijan strengthened its military against enemy Armenia and successfully regained control of the Nagorno-Karabakh region last year, which had been under Armenian separatist rule for decades.
– ‘Europe’s energy security’ –
About 75 percent of Azerbaijan’s energy exports are directed towards European markets.
In 2022, the European Commission signed a deal with Baku to double gas imports from the country in an effort to reduce Europe’s reliance on Russian gas.
By 2033, Azerbaijan’s gas supplies to Europe are projected to reach five percent, sufficient to meet the gas needs of Bulgaria, Greece, Serbia, Albania, and southern Italy, according to Bagirov.
“Azerbaijan plays a critical role in ensuring Europe’s energy security,” noted expert Mustafayeva.
Despite being called “a gift of God” by President Ilham Aliyev, fossil fuel reserves are expected to deplete within a few decades.
“Azerbaijan’s oil wells may dry up in 20 years, while natural gas reserves could last for 50 years,” Bagirov estimated.
The Azerbaijani government is aiming to reduce economic dependence on hydrocarbons by focusing on other sectors like technology, agriculture, and tourism, in anticipation of declining demand for fossil fuels in Europe due to decarbonisation efforts, as mentioned by expert Shaban.
– Green agenda –
Azerbaijan’s ambitious plans for expanding energy production could result in an annual emission of 781 million tonnes of carbon dioxide, double the UK’s yearly emissions, as reported by Global Witness environmentalist group.
This has drawn criticism from environmentalists ahead of COP29.
“COP hosts must make progress, not through oil wells or gas pipelines, but by pursuing climate finance and action,” stressed Jasper Inventor, Greenpeace International’s head of delegation for COP29.
Azerbaijan officials claim the country is making noteworthy progress towards setting its own green agenda.
The nation aims to increase its renewable energy capacity to 30 percent by 2030 and slash greenhouse gas emissions by 40 percent by 2050.
Shikhaliyev mentioned “clean energy mega projects” including transforming the recently recaptured Nagorno-Karabakh region into a “green energy zone” powered solely by solar, wind, and hydro energy sources.
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