The State Oil Company of Azerbaijan Republic optimizes costs

Baku. 15 December. REPORT.AZ/ Gradual fall in oil prices on world markets, setting prices at below $40 a barrel has led to the need for appropriate measures for the preservation of financial stability and optimize the costs of the State Oil Company of Azerbaijan Republic (SOCAR), considering the international experience. Report was told in the press service of SOCAR.

According to the order of the President of SOCAR, next steps in this direction have been already defined.

"The main issue is the revision of the incomes and expenses of the organizations within the SOCAR structure without compromising their technological activities, as well as the number and staff units are part of these institutions units, the direction of funds in higher-yielding areas that require lower cost. In order to improve the system risk management relevant structural units have been instructed to prepare a map of project risks based on the list of the risks in order of importance the project risks of large-scale investment of SOCAR projects", the information says.

The order also reflects measures aimed at limiting the social-oriented projects, sponsorship and charitable activities, limited financial assistance, reducing transportation costs, communication costs, the purchase of office supplies. Before the establishment of a more favorable economic situation in relation to the price of oil, organization and financing of exhibitions, conferences, symposia, seminars, trainings and other similar activities, increased control over the timing and composition of delegations of business trips, traveling to foreign countries is limited. Structural divisions of the company is entrusted to tighten control over the procurement of goods, works and services, providing a continuous process in the extraction and transportation of oil and gas processing industry.

At the same time, on January 1, 2016 major changes are expected in the activities of SOCAR representatives. In order to reduce these costs to zero, the activities of most missions will be provided by other relevant entities SOCAR on the public bases. The document also reflects the measures aimed at reducing the costs of goods and services purchased from companies, as well as reducing the production losses, increasing the efficiency of sales and purchases.