Socar’s new carbamide plant
The State Oil Company of Azerbaijan Republic (SOCAR; www.socar.az) has announced the start of production of its new carbamide plant. The plant has a production capacity of 650–660,000 metric tons per year (m.t./yr) of carbamide products using 435 million cubic meters of natural gas as a raw material.
Carbamide is a compound containing high levels of nitrogen and is considered as one of the best fertilizers, also because of its quick solubility in water. It is produced by the synthesis of ammonia and carbon dioxide. There is a high demand for this fertilizer due to its low production costs, economical transportation, convenient application and high productivity in agriculture. Carbamide is widely used in the production of other chemicals and pharmaceuticals also.
Whereas the nitrogen fertilizers were imported to Azerbaijan previously, the new plant will fully meet the domestic market’s needs, with additional export amounting to about 70% of the plant’s output. As a result, the country will save approximately $90 million of annual import expenditures, whilst the export of fertilizers will become an additional source of income for Azerbaijan.
The carbamide plant of SOCAR is currently the largest project of the non-oil sector in the country, with a total cost of about €800 million. The project was initially funded from the state budget. On January 27, 2017, a state guaranteed loan of €500 million was taken from the South Korean Export-Import Bank (KEXIM), as well as Societe Generale (France), Deutsche Bank (Germany) and UniCredit (Austria). The long-term financial injection taken through the support of partner banks has reduced the state budget’s burden. Also, SOCAR has contributed about €100 million to cover taxes and duties, as well as other expenses related to the project.
The foundation of the carbamide plant was laid in 2011 in a ceremony attended by the President of the Republic of Azerbaijan Ilham Aliyev. The plant was constructed by South Korea’s Samsung Engineering Co., Ltd implementing technologies introduced by Denmark’s Haldor Topsoe and Stamicarbon B.V of the Netherlands. Neste Engineering Solutions Oy of Finland has provided project management consultation and independent inspection services.