Speech by Ilham Aliyev at the signing ceremony of the final investment decision on Shah Deniz-2

- Distinguished guests,

Ladies and gentlemen!

First of all, I welcome each of you in Azerbaijan today. I express appreciation to the heads of state and government and ministers because they accepted our invitation to participate in this event. Today is a historic day in the history of modern Azerbaijan. The implementation of the Shah Deniz-2 energy project will begin today. And it will secure the long-term development of our country.

Shah Deniz-2 is one of the world's largest energy projects. This project is for energy security and diversification of energy. Greater cooperation between states and companies participating in this historic project will be ensured. But today I want to go 19 years back – in 1994 when the energy strategy of Azerbaijan was created. We achieved this thanks to the wisdom and foresight of our national leader Heydar Aliyev. Just three years after gaining independence, one year after the end of the civil war in Azerbaijan and four months after the ceasefire in the war with Armenia, Azerbaijan signed "the Contract of the Century" with foreign partners. This event opened the Caspian Sea to foreign investors for the first time and ensured the successful economic development of our country. This contract was called "the Contract of the 20th century". And Shah Deniz, I think, will become the contract of the 21st century. And before that event, the development of the energy sector of independent Azerbaijan saw a number of important historic events. In 1996, an agreement was signed on the Shah Deniz gas field, and then in 1999, the first pipeline was built linking the Caspian Sea to the Black Sea coast of Georgia. Then, in 2006, the Baku-Tbilisi-Ceyhan main export pipeline was built linking the Caspian Sea to the Mediterranean Sea and international markets, and in 2007 – the Southern Gas Pipeline. This pipeline connected Azerbaijan, Georgia and Turkey to another project, which is an integral part of the current ceremony.

In 2011, Azerbaijan and the European Union signed a memorandum on strategic energy cooperation. It also, in turn, facilitated the implementation of the energy strategy of our country and diversification of energy supplies to Europe. Last year we signed with Turkey a historic agreement on the Trans-Anatolian Pipeline – TANAP. And this year, the TAP project was selected as a major export route. Finally, today we are signing the final investment decision on Shah Deniz-2.

It was an excursion into history - important events on the path we travelled towards the project for the complete development of Azerbaijan's largest gas field. This project will change the energy map of the region and Europe. Azerbaijan's gas reserves will be delivered to the markets expecting these resources. According to our calculations, the gas reserves of Azerbaijan total 3 trillion cubic metres.

Shah Deniz-2, TANAP and TAP are among the world's largest energy projects. The project will involve an investment of $ 45 billion, and more than 30,000 new jobs will be created in the countries along the route. Of course, this project will require additional efforts.

We are only at the beginning of an ambitious project, which can be implemented through joint efforts. Today, I congratulate the people of Azerbaijan on this historic day. This project will ensure the long-term sustainable economic development of our country. At the same time, I express my gratitude to the Shah Deniz consortium for the efforts related to Azerbaijan. In particular, I express my gratitude to the two leaders of Azerbaijan's energy sector - SOCAR and BP, which are strategic partners. Between BP and SOCAR there is 20-year experience of cooperation. The agreements that we will sign will allow us to extend this cooperation by 40 years and longer.

I would also like to note that the energy policy of Azerbaijan made it possible to transform and diversify our economy. When we regained our independence, the private sector's share in GDP was zero per cent. Today, the private sector accounts for 85 per cent of our economy. We reduced the unemployment rate to 4.8 per cent. The poverty rate was reduced to 5.5 per cent. Our foreign debt accounts for only 8 per cent of the gross domestic product. Finally, there is a stable financial situation, and we are investing in the non-oil sector, which accounts for 55 per cent of our economy.

For this reason, energy policy, close cooperation with international institutions and diversification and transparency are among the key elements of successful development. I believe that Azerbaijan has not caught the "oil disease", so-called "Dutch disease". We are an example of how oil and gas should serve the interests of the people. Of course, one of the main prerequisites for this is international cooperation. We appreciate this cooperation as the knowledge and experience of foreign companies are very important to us.

Today, this collaboration comes into a wider format and a new format of cooperation is being created, which will cover more countries and companies. I am sure that in the future project, Shah Deniz-2 will cover a wider geographical area than currently envisaged.

For the timely delivery of our gas to European markets, today, we, of course, must turn our attention to the implementation of the TANAP and TAP projects. This will require close cooperation with the countries covered by the initial phase of the Shah Deniz project - Azerbaijan, Georgia, Turkey, Greece, Albania, Italy and Bulgaria. At a later stage we will start to actively cooperate with Montenegro and Croatia. We have plans to extend the pipeline towards the Balkans. At the same time, I hope that in the coming years we will carry out together with our partners in Romania, Hungary and Austria active work to extend the pipeline in this direction. We have big plans, according to which the design of the pipeline is also envisaged.

In the future, we will transport volumes of gas we can extract through the envisaged pipelines. Naturally, the Shah Deniz-2 project is a project of energy security. The energy security of each country is inseparable from its national security. In the 1990s, when the Shah Deniz project was signed, it was not so. But today it is a reality. One of the major elements of energy security is natural gas. This is the present situation, and I think that there will be no changes in the next few years. For this reason, energy security and diversification of energy are equally important for such producing countries such as Azerbaijan, as well as for transit countries and consumer countries. I am confident that together we can achieve the right balance of interests of producing countries, transit countries and consumer countries. A format of cooperation beneficial to all of us will be created.

Our energy strategy is based on friendship, cooperation and mutual support. In our history, Azerbaijan has never used its energy potential for other purposes.

I congratulate the people of Azerbaijan, all our friends and international partners on this historic day.

I wish our project success. Success to Shah Deniz-2.