SOCAR II INTERNATIONAL CASPIAN AND CENTRAL ASIA DOWNSTREAM FORUM –TRADING, LOGISTICS, REFINING, PETROCHEMICALSMaximising efficiency to meet new challengesBaku, Azerbaijan, 25 - 28 April 2017

Dedicated to 94th anniversary of the National Leader of Azerbaijan

Haydar Aliyev

BAKI ALİ NEFT MƏKTƏBİ

In the global commodity bust environment oil and gas exporting countries face new serious challenges. Opti-mising production, processing and logistics, deploying efficient trading practices, deploying more sophisticat-ed processing and petrochemical production processes, identifying new revenue sources at all stages of the supply chain, using logistical channels to the maximum, controlled cost reduction without detriment to quality and efficiency, retaining key personnel and competences – these are some of crisis management steps and pro-cesses which the industry may use to meet the current challenges.

Some of these measures were implemented in Azerbai-jan and within the structure of SOCAR in the previous price environment: modern petrochemical production clusters were built, logistical channels were developed, competent personnel were trained and deployed. SO-CAR actively and successfully expanded into opportun-istic trading. However, the extent and the depth of the commodity crisis and the scale of challenges the global economy faces call for new solutions, a complete rethink of strategy and tactics of export, domestic market and transport operations, more improvements and efficien-cies in refining and petrochemical production.

Drawing on Azerbaijan’s experience of nursing the in-dustry back to health in the 90s and laying the foun-dation for spectacular development in the following decade will be useful in planning and managing the is-sues we currently face. This was the time when the oil and gas industry of Azerbaijan was suffering greatly from the consequences of the break up of the Soviet Union, the low price environment, and when the whole of Azer-baijan was affected by the recent war. The oil and gas industry strategy which was developed and deployed by the National Leader Heydar Aliyev is an excellent exam-ple of identifying and applying unconventional efficient solutions in production, transportation and trading of hydrocarbons in a difficult market environment.

Now the industry is again in a position when spectacu-lar results need to be achieved from a very low starting point in an adverse environment.

The State Oil Company of the Azerbaijan Republic (SOCAR) is involved in exploring oil and gas fields, producing, processing, and transporting oil, gas, and gas condensate, marketing petroleum and petrochemical products in domestic and international markets, and supplying natural gas to industry and the public in Azerbaijan. SOCAR comprises three production divisions – crude, gas and petrochemical, one oil refinery and one gas processing facility, a deep water platform fabrication yard, one institute for training petroleum engineers and an operator training centre, 23 specialised subdivisions covering all of the supply and technology chain, from exploration/geophysics to retail.

Joint ventures (including ventures in Georgia and Turkey), consortia, and operating companies established with SOCAR’s participation, operate throughout the industry supply chain. SOCAR has representative offices and subsidiaries in Georgia, Turkey, Romania, Austria, Switzerland, Russia, Kazakhstan, Great Britain, Iran, Germany, Ukraine, Singapore, Vietnam, Nigeria, and other countries.

SOCAR II INTERNATIONAL CASPIAN AND CENTRAL ASIA DOWNSTREAM FORUM – TRADING, LOGISTICS, REFINING, PETROCHEMICALS

Baku, Azerbaijan, 25 - 28 April 2017

Ddedicated to 94th anniversary of the National Leader of Azerbaijan

Haydar Aliyev

FORUM TOPICS

MARKETS, TRADING, LOGISTICS: Overview of the current oil, gas, refined and petrochemical product market structure and condi-tions in the Caspian region and Central Asia and the related export markets and routes.

Overview of intra region and export trade flows and marine, pipeline and rail logistics support-ing these flows

Improving efficiency and workload of the existing transport corridors for hydrocarbons and petrochemical products

REFINING: The technological conditions and commercial positioning of the Caspian and Central Asian re-fining

Prospects for development of refining facilities in the region

Efficient refinery construction and modernisation project management

PETROCHEMICALS: Petrochemical facilities in the Caspian region and Central Asia – technical overview

Supply and demand analysis for petrochemical products in the region and its export potential

SOCAR’s experience in deploying complex petrochemical production facilities.

This Forum, commemorating Haydar Aliyev’s 94rd anniversary is intended to be a discussion, brainstorming and a solution development platform to improve technical and commercial efficiency and social commitment of the downstream sector of Azerbaijan and the countries of the Caspian Region and Central Asia:

• TRADING

• LOGISTICS

• REFINING

• PETROCHEMICAL INDUSTRY

We will be pleased to welcome in Baku as Forum delegates traders, operations specialists, terminal operators, tanker owners and ship brokers, rail and pipeline operators, refiners and petrochemical industry representatives.

THE FORUM IS INTENDED FOR: Senior, commercial and technical management of vertically integrated oil and gas companies

Traders and logistics support specialists of vertically integrated and trading companies

Terminal, tanker, rail tank car, pipeline operators, crude and product freight forwarders

Refinery and petrochemical engineers

Refining and petrochemical process and technology licensors, equipment suppliers

Trade and project finance banks

Industry analysts, pricing agencies

SOCAR II INTERNATIONAL CASPIAN AND CENTRAL ASIA DOWNSTREAM FORUM – TRADING, LOGISTICS, REFINING, PETROCHEMICALS

Baku, Azerbaijan, 25 - 28 April 2017

AMONG THE SPEAKERS OF THE PREVIOUS FORUM:

Farid Jafarov, Director of SOCAR Polymer

Bakhtiyar Aslanbeili, Vice-President

of BP Azerbaijan

Nick Coleman

Senior Editor, Oil News, S&P Global Platts

Niccolò HeilpernHead of Branch Office in

Azerbaijan at KT - Kinetics Technology S.p.A.

Zamig Ismayilov, Deputy Chairman of the Board

of Azerbaijan Caspian Shipping Company

Alexander Yershov, Chief Editor,

Thomson Reuters

Captain Sakhit Istikbal,

Director of Sea News Turkey

Denis Varaksin, DYM Resources

trader

SOCAR II INTERNATIONAL CASPIAN AND CENTRAL ASIA DOWNSTREAM FORUM – TRADING, LOGISTICS, REFINING, PETROCHEMICALS

Baku, Azerbaijan, 25 - 28 April 2017

Academician Khoshbakht Yusifzade,

First Vice-President, Geology, Geophysics

and Field Development, SOCAR

Doctor of Economic Sciences,

Natig Aliyev, Minister of Energy

of Azerbaijan Republic

Mukhtar Babayev, Chairman

of Supervisory Board, Azerikimiya Production

Union (SOCAR)

Elmar Gasimov,

PhD (Geography),

Rector, SOCAR Baku Higher Oil School

BAKI ALİ NEFT MƏKTƏBİ

Russia

Ukraine

Georgia

Iran

Turkmenistan

Uzbekistan

Kazakhstan

Tajikistan

Afghanistan

Kyrgyzstan

Azerbaijan

Baku

25 April, Tuesday

Session 1. THE OPENING CEREMONY AND THE PLENARY SESSION.

MACROECONOMIC OVERVIEW

GLOBAL ENERGY MARKET OVERVIEW. CASPIAN AND CENTRAL ASIA AS ONE OF THE KEY ELEMENTS OF THE GLOBAL OIL AND GAS MARKETS.

AZERBAIJAN’S OIL AND GAS INDUSTRY IN THE GLOBAL CONTEXT.

THE REGIONAL CASPIAN AND CENTRAL ASIA OIL AND GAS ECONOMICS. LOCAL DEMAND AND THE KEY EXPORT MARKETS

FOCUS SESSION: SOCAR AS THE REGIONAL LEADER IN THE INTERNATIONAL HYDROCARBONS TRADING. The success of SOCAR in developing a successful trading division

SOCAR in the CIS – challenges and success

SOCAR Trading in the global context

Session 2. THE CASPIAN AND CENTRAL ASIAN GAS MARKET. KEY EXISTING AND PROSPECTIVE CUSTOMERS FOR THE CASPIAN AND CENTRAL ASIAN GAS. .

Session 3. REGIONAL PIPELINE PROJECTS – EXISTING, DEVELOPING AND CONCEPTUAL. PROVIDING ADEQUATE RESOURCES FOR THE BTC. TANAP – POTENTIAL FOR IMPLEMENTATION, RESOURCES AND THE ROLE OF TANAP IN EUROPEAN SECURITY OF SUPPLY.

GALA DINNER FOR SOCAR GUESTS AND THE FORUM DELEGATES

26 April, Wednesday

Session 4. KEY GLOBAL TRADE FLOWS AND ROUTES. THE REGIONAL CRUDE, PRODUCT AND GAS TRADING LOGISTICS. TRANSCASPIAN LOGISTICS. KAZAKHSTAN (AKTAU, RAIL) – BAKU – GEORGIAN PORTS CORRIDOR.

Session 5. PRICING AND TRADING SPECIFICSN AND CENTRAL ASIA – ECONOMICS AND TECHNOLOGIES

Session 6. EVOLUTION OF REFINING IN THE CASPIAN REGION AND CENTRAL ASIA. COMMERCIAL ASPECTS Demand trends

Quality control and regional retail specifics

DRAFT PROGRAMME:

SOCAR II INTERNATIONAL CASPIAN AND CENTRAL ASIA DOWNSTREAM FORUM – TRADING, LOGISTICS, REFINING, PETROCHEMICALS

Baku, Azerbaijan, 25 - 28 April 2017

*DISCLAIMER: This document is a draft overview of the themes to be covered at the Event. Its publication is intended solely for the purpose of presenting the Organisers’ view on the proposed programme structure. The Organisers do not make any statements about and does not guarantee participation of any of the above-mentioned organisations or coverage of the topics listed above. The Organisers welcome constructive suggestions and recommendations from any interested industry organisations and individuals. Drafts of the programme containing times and topics will be made available to interested parties as they are developed. The final programme will be issued to participants and accredited media representatives upon registration.

27 April, Thursday

CONFERENCE REFINING IN THE CASPIAN REGION AND CENTRAL ASIA – ECONOMICS AND TECHNOLOGIES

Session 1. OVERVIEW OF REFINING AND PETROCHEMICAL INDUSTRY IN THE CASPIAN REGION AND CENTRAL ASIA

REFINING

Global refining trends – pricing, technologies, development prospects

The future of refining in Azerbaijan: volumes and export markets

Refining capacity sufficiency in the Caspian region and Central Asia regions – identifying the balance point

Quality control and regional retail specifics

PETROCHEMICALS Demand projections and export potential for key product categories

PE

PET

Polypropylenes

Artificial fibre

Ammonia

Fertilisers

Gas based chemical industry. The current state and development prospects for gas processing and gas-fed chemical industry in Kazakhstan and Uzbekistan.

SOCAR and АZERIKIMYA experience in developing modern petrochemical production and petrochemical based industrial clusters in Azerbaijan, managing a large scale international petrochemical group – Azerikimya/Petkim

Session 2. INNOVATIVE TECHNOLOGIES AND PRODUCTION EFFICIENCY REFINING

Configuration of the key refineries in the Caspian and Central Asia.

Managing complex refinery and petrochemical modernisation and construction projects

Financing local refinery modernisation and construction projects

PETROCHEMICALS Overview of the cutting edge technologies for petrochemical industry – economics as a driver for modernisation

Managing modernisation and new construction projects in petrochemical industry

Petrochemical facility optimisation – energy consumption and technology improvement

Developing petrochemical facilities in deflationary or static market conditions – financial aspects

28 April, Friday

TECHNICAL VISIT PROGRAMMESOCAR Oil TerminalHeydar Aliyev RefinerySumgait Petrochemical Complex

SOCAR II INTERNATIONAL CASPIAN AND CENTRAL ASIA DOWNSTREAM FORUM – TRADING, LOGISTICS, REFINING, PETROCHEMICALS

Baku, Azerbaijan, 25 - 28 April 2017

DRAFT PROGRAMME: