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SOCAR's actual gas production cost increased by more than 5%

15 September 2025 12:00 (UTC +04:00)

Last year, the actual production cost of 1,000 cubic meters of gas at SOCAR amounted to 80.25 manats, APA-Economics reports, citing SOCAR’s annual report.

The production cost of gas at the company increased by 4.22 manats or 5.5% compared to the 2023 figure.

According to the report, in the structure of total expenses incurred for gas production at the company, the share of material costs accounted for 2.6%, fuel costs – 0.3%, electricity costs – 0.4%, wages – 13%, social insurance contributions – 3%, depreciation of fixed assets – 17%, repair and maintenance of fixed assets – 13.4%, transportation costs – 13.1%, security costs – 2.3%, mining tax – 16.2%, other taxes – 4%, expenses for other services – 12.2%, and other expenses – 2.4%.

The document states that taking into account not only the costs of gas production, purchases from “Azercontract” JSC, and imports, but also the costs of gas processing, storage, transportation, and distribution, the actual cost of 1,000 cubic meters of gas sold by SOCAR in 2024 amounted to 176.82 manats.

"The increase in the cost of gas is mainly due to the decline in commercial gas production compared to the previous year. Compared to last year, commercial gas production decreased by 700,738 thousand cubic meters or 13.1%," the report notes.