Azerbaijani President Ilham Aliyev has signed a decree on Feb. 25 establishing a closed joint-stock company (CJSC) for effective management of projects within the second phase of Shah Deniz gas and condensate field's development, expansion of the South Caucasus Pipeline, Trans-Anatolian Gas Pipeline (TANAP) and Trans Adriatic Pipeline (TAP).
The decree says that given the proposals from the State Commission for effective management of these projects, the State Oil Company of Azerbaijan Republic (SOCAR) will create a closed joint stock company (51 percent state-owned and 49 percent owned by SOCAR) with an authorized capital of $100 million.
SOCAR should also ensure the transfer of shares in projects to the newly created closed joint stock company (CJSC).
State Oil Fund of Azerbaijan (SOFAZ) has been instructed to provide an equity financing for the CJSC, which is under direct state ownership. The funds to be provided to the CJSC for financing the equity will provide a long-term investment on return conditions.
SOFAZ will be represented at the CJSC's Supervisory Board by its representatives, chosen by the State Commission.
The ownership and management of the CJSC's shares, which are directly owned by the state, will be conducted by the Economy and Industry Ministry, while the dividends on those shares will be transferred to SOFAZ.
CJSC's proceeds received from all projects will be transferred to SOFAZ, until all of funds invested in the joint stock company are repaid.
The State Commission has been instructed to settle issues arising out of this decree.
State Commission was established by the decree of Azerbaijani President Ilham Aliyev on October 29, 2013 in accordance with the presidential decree on financing the shares and other financial obligations of SOCAR with the state's funds within the second phase of Shah Deniz gas and condensate field's development and expansion of the South Caucasus Pipeline, Trans Anatolian Gas Pipeline (TANAP) and the Trans Adriatic Pipeline (TAP).