BAKU, Azerbaijan, September 15. The cost of producing one ton of oil reached 160.5 manat ($94.4) last year, up 11.8 percent, or 16.9 manat ($9.9), from the previous year.
Data obtained by Trend from the SOCAR’s (State Oil Company of Azerbaijan) 2024 report indicates that the breakdown of total production costs for oil includes 3.1 percent for materials, 0.3 percent for fuel, 0.8 percent for electricity, 15.7 percent for salaries, 3.5 percent for social insurance contributions, 20.4 percent for asset depreciation, 13.8 percent for repairs and maintenance, 12.1 percent for transportation, 2.5 percent for security, 6.3 percent for mining taxes, 4.6 percent for other taxes, 13.1 percent for other services, and 3.9 percent for other expenses.
For gas, the production cost of 1,000 cubic meters rose to 80.2 manat ($47.1), an increase of 5.5 percent from the previous year.
Total costs for gas production included 2.6 percent for materials, 0.3 percent for fuel, 0.4 percent for electricity, 13 percent for salaries, 3 percent for social insurance, 17 percent for asset depreciation, 13.4 percent for repairs and maintenance, 13.1 percent for transportation, 2.3 percent for security, 16.2 percent for mining taxes, 4 percent for other taxes, 12.2 percent for other services, and 2.4 percent for other expenses.
Taking into account production, purchases from Azercontract CJSC, imports, as well as processing, storage, transportation, and distribution costs, the actual cost of 1,000 cubic meters of gas sold in 2024 was 176.8 manat ( $104).
The increase in oil production costs was primarily due to higher expenditures on fuel (108,000 manat ($63,529), 4 percent), electricity (886,000 manat ($521,178), 12.6 percent), salaries (12.1 million manat ($7.1 million), 8 percent), social insurance (2.2 million manat ($1.2 million), 6.4 percent), asset depreciation (29.4 million manat ($17.2 million), 15.9 percent), transportation (15.4 million manat ($9 million), 13.9 percent), other taxes (1.41 million manat ($829,400), 3 percent), services (14.5 million manat ($8.5 million), 11.8 percent), and other operational costs (8.7 million manat ($5.1 million), 27.2 percent).
Gas production costs rose mainly because of a 13.1 percent decline in marketable gas output, which dropped to 700.7 million cubic meters compared to the previous year.
