Contract Of Century Turns 31 As Azerbaijan Hits New Oil And Gas Records

Azerbaijan's oil and gas sector has long been the engine driving the country's economic development, regional influence, and international prestige. In 2025, the Azeri-Chirag-Gunashli (ACG) block in the Caspian Sea continues to demonstrate the transformative power of Azerbaijan's energy strategy, highlighting both the country's historical vision and its ongoing capacity for large-scale energy production.

Now today marks the 31st birthday of the infamous Contract of the Century. Since the signing of the historic deal in Baku on September 20, 1994, Azerbaijan has steadily advanced its energy sector, attracting billions of dollars in foreign investment and establishing itself as a reliable partner for leading global oil companies. The agreement enabled the joint development of the ACG fields by 13 international companies from eight countries, including BP, Amoco, Unocal, Lukoil, Statoil, and Turkish Petroleum, alongside Azerbaijan's SOCAR. This partnership not only facilitated large-scale oil production but also created the foundations for economic stability, infrastructure development, and human capital growth across Azerbaijan.

To date, Azerbaijan has produced 613 million tons of oil and 239 billion cubic meters of gas from the ACG block. Of the total gas extracted, 61.3 billion cubic meters have been delivered to the state. In the first eight months of 2025 alone, average daily oil output reached 44,000 tons, with daily oil exports standing at 327,000 barrels. Meanwhile, the newly operational Azeri-Central-Eastern (ACE) platform within the ACG block has already delivered 1.4 million tons of oil and 228 million cubic meters of gas since its inception, reflecting the success of the final investment decision made in 2019 and first production starting in 2024.

The impact of Azerbaijan's oil sector extends far beyond raw production figures. Revenues from the ACG fields and subsequent projects like the ACE platform have strengthened the state budget, funded infrastructure projects, and supported social programs. The establishment of the State Oil Fund of Azerbaijan (SOFAZ) in 1999 has ensured transparent management of oil revenues, protecting resources for future generations while maintaining economic stability.

The“Contract of the Century” also linked Azerbaijan closely with Western energy markets and institutions, paving the way for strategic projects like the Baku-Tbilisi-Ceyhan (BTC) pipeline. Since 2006, the 1,768-kilometer BTC pipeline has transported 605 million tons of crude oil, including 13 million tons in the first half of 2025 alone. Operational costs for BTC currently stand at around $60 million with capital expenditures of $30 million, and the pipeline has delivered a total of 4.6 billion barrels of crude oil to international markets since its launch.

Beyond production and export figures, Azerbaijan's oil strategy has served as a catalyst for broader economic and social progress. The energy sector has created thousands of jobs, provided Azerbaijani specialists with international experience, and supported education for students abroad. Infrastructure projects financed by oil revenues-including roads, schools, and hospitals-have elevated the quality of life for citizens and reinforced Azerbaijan's long-term development goals.

The ACE project represents the next chapter in Azerbaijan's energy journey. With the first oil produced in 2024 and ongoing gas output, the platform strengthens the country's position as a regional energy leader while ensuring the efficient extraction and management of resources. According to the Ministry of Energy, the combined output from ACG and ACE continues to secure Azerbaijan's role as a stable, reliable, and influential player in global energy markets.

Azerbaijan's experience demonstrates that natural resources, when managed strategically and transparently, can serve as a foundation for national development, geopolitical influence, and sustainable growth. From the visionary steps of the 1990s to the current high-output operations of ACG and ACE, the country's energy sector remains central to its ambition, resilience, and enduring prosperity.

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