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Inventory of greenhouse gas (GHGs) emissions

Since 2008, SOCAR has started the inventory of greenhouse gas (GHG) emissions in all fields of activity and publishing annual reports on it.

Cooperation with World Bank's Global Gas Flaring Reduction Partnership (GGFR)

SOCAR successfully cooperates with the World Bank's Global Gas Flaring Reduction Partnership (GGFR). Within the framework of the cooperation, the Plan for reducing carbon dioxide emissions in SOCAR and SOCAR-participated projects was prepared and implemented during 2011-2015. In 2012, SOCAR was awarded the Excellence Award of GGFR for the projects of glass disposal in the 28 May OGPD’s Guneshli field and Oil Rocks OGPD’s fields.

In 2015, our company was, for the second time, awarded the Excellence Award of the GGFR for the successful implementation of the project Gas Flaring Reduction in the Azeri-Chirag-Gunashli fields together with bp.

Plan for reducing associated gas emissions

In 2017, as a succession of the associated gas management works, the company approved the Associated Gas Reduction Plan in SOCAR Projects in 2017-2022, Action Measures were developed, and important works were carried out to prevent the emission of associated gases into the atmosphere.

SOCAR has joined the World Bank's Zero Routine Flaring by 2030 (ZRF) initiative and plans to reduce associated gas emissions. As a result of the successful cooperation and conducted work, SOCAR’s associated gas emissions in 2020 accounted for approximately 2% of the total production. Onshore production sites of Azneft PU, has reduced the carbon dioxide emission to zero, which is the first time for the region.

NAMA project

In 2015, within the framework of cooperation between SOCAR and the UN, the Nationally Appropriate Mitigation Actions (NAMAs) for Low-Carbon End-Use Sectors in Azerbaijan project was implemented. The project was implemented with the financial support of the Global Environment Fund (GEF) and SOCAR.

The project comprises three components:

- Increasing energy efficiency in buildings;

- Transition to alternative fuel in transport;

- Collecting associated gas from wells and supplying it to users.

Work completed within the first component

- Solar panels with a capacity of 10 kW to provide both indoor and outdoor lighting have been installed at the Polyethylene Plant of SOCAR’s Azerikimya PU; 23 kW solar panels - on the roof of the “Kimyachi” Palace of Culture to use alternative energy sources; 15 kW solar panels - in the Eco-Park; 60 solar panels with a capacity of 15.36 kW and 7 wind generators with a capacity of 12.8 kW have been installed in the Waste Management Centre (WMC).

- Azerikimya PU has implemented a number of projects to increase energy efficiency in the house building of Polyethylene production, including facade, heating-cooling, ventilation systems, cost-effective operation systems allowing water and energy to be saved, and projects that increase energy efficiency. The facade of the building has been covered with special insulation materials to save energy resources.

Work completed within the second component

- 2 (two) Toyota RAV 4x4 Hybrid and 3 (three) Toyota Auris Hybrid vehicles have been included in SOCAR's transportation fleet;

- An Eco-driving simulator has been purchased and handed over to SOCAR's Training and Certification Department to train employees of SOCAR's Transport Department;

- Foreign expert have organised seminars for SOCAR employees on the completed and future works for decarbonisation of transport;

More than 1,000 drivers of SOCAR passed training in the eco-simulator and received a special certificate.

Work completed within the third component

A new compressor and separator, as well as a refrigeration and online control system were installed at 3 gas collection points in the Zagli-Zeyva field at Siyazanneft OGPD. In addition, the Company constructed a gas pipeline with a total length of 32 km. SOCAR succeeded to collect 6.8 million cubic metres of associated gas per year, and after processing, natural gas was delivered to 15 surrounding villages with 1,250 subscribers.

Cooperation within the framework of Methane Guiding Principles (MGP)

Since 2019, SOCAR joined the Methane Guiding Principles at the initiative of Shell and BP. The Methane Guiding Principles identify key priorities for reducing methane emissions along the entire value chain of natural gas, from production to consumption.

Caspian Environmental Protection Initiative – CEPI

On the 14th of September 2020, SOCAR, KazMunayGas (Kazakhstan), bp (the United Kingdom), Equinor Absheron AS (Norway) and Total E&P Absheron B.V. (France) established an independent regional Initiative Group named “Caspian Environmental Protection Initiative - CEPI” at the initiative of SOCAR, and signed a Memorandum of Understanding. At the first meeting of the Executive Committee of the founding companies, Rafiga Huseynzade, SOCAR's Vice President for Ecology, was elected as the chairman of that Committee. In 2021, Russian "Rosneft" joined the Initiative as well. The organisation’s mission is to mobilise oil and gas companies operating in the Caspian region in the fight against environmental and economic threats associated with climate change. The main goal is to prevent activities that threaten environmental sustainability in the Caspian Sea. CEPI aims to be the most transparent and effective initiative to promote environmental sustainability in the field of oil and gas activities in the Caspian region. CEPI members support a policy of drastically reducing carbon emissions.

Upstream Emission Reduction – UER

SOCAR implements a pilot project in the oil production process called Leak Detection and Repair (LDAR) to identify and eliminate leaks in the fields it develops. With a rich and successful experience in the field of environmental protection, SOCAR’s project combines practical solutions for reducing emissions within the framework of a low-carbon development strategy, process optimisation, and decarbonisation measures. Based on the cooperation with international partners and verification companies, SOCAR has achieved a significant reduction in carbon emissions in onshore oil production areas and certified UER (Upstream Emission Reduction) emissions.

The LDAR project received the support by the Ministry of Ecology and Natural Resources of the Republic of Azerbaijan. It was also registered under the European Union Fuel Quality Directive and was the first Azerbaijani project implemented in the Emissions Trading System (ETS).

As part of the LDAR project, instrumental measurements were carried out in the oil and gas infrastructure, examinations using modern infrared light to detect emissions of methane and other volatile organic compounds. Sources and volumes of leaks have been determined, and measures have been taken to repair the leak sources and increase the reliability of the infrastructure in progressive ways. A special methodology for calculating emissions has been developed and approved by relevant international organisations. After eliminating leakage sources, repeated monitoring and inspection was conducted several times.

SOCAR’s Low Carbon Development Strategy

The main goal of SOCAR 2021-2030: Low-carbon Development Strategy is the development of measures to reduce greenhouse gases (GHGs) by applying economically and environmentally efficient technologies. The strategy includes the implementation of a wide range of measures to reduce the impact of climate change, the implementation of existing low-carbon technologies in the production areas, and the assessment of the impact of climate risks on oil and gas operations, ensuring the fulfilment of SOCAR's obligations within the framework of the Nationally Determined Contributions of the Republic of Azerbaijan, mitigation, adaptation measures, and reporting and verification measures.

Vison Zero

Some of the world’s largest oil and gas producers have announced their strategies for transitioning to Vision Zero by 2050. To reach Vision Zero by 2050 or sooner, the main goals are set, such as completely carbon-free oil and gas production, reducing the carbon intensity in products sales to 50-65%.

SOCAR has set ambitious targets for reducing emissions resulting from its activities in the low-carbon development strategy. In response to the calls for Vision Zero in oil-gas and petrochemical operations, SOCAR prioritise such issues as environmental protection, reduction of the energy capacity of the product unit, carbon footprint and carbon intensity, and carbon neutrality.

Methods for estimating GHG emissions from stationary combustion sources

As a member of the State Commission on Climate Change, SOCAR has developed a corporate methodology for the calculation of the GHG. The methodology was reviewed in the Cabinet of Ministers and received a positive feedback for its application. SOCAR currently applies the method for estimating emissions from stationary combustion sources.

SOCAR has started the implementation of the Measuring, Reporting and Verification (MRV) project for the improvement of the corporate GHGs inventory system, increasing the accuracy, sustainability, and traceability of reporting. The project will help to reduce the dependence on the human factor and digitalisation of the GHGs inventory reports in a wide geographical area, upstream, midstream, downstream, as well as in the service sector.

Use of alternative and renewable energy sources

SOCAR has implemented several important projects in application of alternative and renewable energy sources in WMC, Eco-Park and Azerikimya PU. As mentioned, solar panels with a capacity of 15 kW/t and wind generators with a capacity of 24 kW/t have been installed in the Waste Management Centre (WMC). In addition, solar panels with a capacity of 10 kW to provide both indoor and outdoor lighting have been installed at the Polyethylene Plant of SOCAR’s Azerikimya PU; 23 kW solar panels have been installed on the roof of the ”Kimyachi” Palace of Culture to use alternative energy sources, while 15 kW solar panels - in the Eco-Park.

An Energy Management Centre has been established for the registration and efficient management of energy produced from renewable energy sources in the eco-park area. The purpose of the centre is to monitor the use of electricity produced from renewable energy sources in Garadagh, Sumgait, and Gala territories.

SOCAR continues to develop project ideas to ensure the electricity supply of the company’s offshore production sites through alternative and renewable energy sources.

Plans to reduce emissions

The 26th Conference of the Parties (COP26) of the UN Framework Convention on Climate Change made several important decisions on the environment. SOCAR is one of the institutions responsible for the implementation of the goals set by the State Commission on Climate Change and the Ministry of Ecology and Natural Resources of the Republic of Azerbaijan. SOCAR's scope of activity includes expanding the application of renewable energy sources, developing research on project solutions such as wind turbines, solar panels, etc., developing "Green hydrogen" production, carbon capture, utilisation, and storage (CCUS) infrastructure, systematic and continuous measures to minimise the carbon footprint and increase energy efficiency in production activities.

Energy Management Centre

The functions of the Energy Management Centre commissioned in the Eco-park area within the framework of NAMA include online monitoring, integration of weather information into the programme, registration of energy produced in renewable energy sources, the amount of energy consumed in administrative buildings, and archiving of all data for analysis.

Carbon credits

The Emissions Trading System (ETS) and the Carbon Border Adjustment Mechanism (CBAM) implemented in the European Union to reduce carbon emissions are considered a serious challenge for energy companies.

To supply energy carriers to international markets, energy companies should comply with the necessary requirements for carbon emissions certification set by customers or countries. In this regard, identification of emission sources, elimination of leaks, and verification and certification of reduced emissions have a positive effect both in terms of returning valuable resources to use and reducing the carbon footprint of production.

The use of emission reduction, certification, and trading mechanisms during oil-gas and petrochemical operations is a stimulus for continuous implementation of decarbonisation measures and an effective tool for achieving a significant reduction in emissions. The main advantage of emission reduction and trading projects is to contribute to the protection of the environment by reducing emissions and to obtain additional investments by trading reduced emission volumes.

SOCAR operates a specialised monitoring team equipped with modern instrumental devices and equipment for determining emissions and leaks from unorganised sources. The company has gained positive experience in the implementation of a project to identify and eliminate leakage sources, measurements, repair works to eliminate leaks, verification of the implemented measures by an international auditor-company, and the conclusion of a carbon credit trading agreement.

SOCAR will expand the use of emission reduction and implementation mechanisms within the framework of the ETS.