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Azeri Leader Sees Oil Output Recovering as BP Acts to Stem Slump

BP Plc (BP/), the U.K. oil producer leading Azerbaijan’s biggest energy projects, will stem a drop in output in the country after responding “responsibly” to criticism from Azeri President Ilham Aliyev, the leader said.

“I am very glad that BP, which is our main partner, responded to my views and criticisms very responsibly,” Aliyev said in comments published today in the state-run daily newspaper Azarbaycan. “The BP president spoke to me about his company’s plans for the coming years. I am glad that the stabilization of oil output is the priority.”

Production at the BP-led Azeri-Chirag-Guneshli oilfield fell 12 percent in the first half of the year, prompting Aliyev to call on the London-based company to fix “grave mistakes.” BP has since replaced regional managers and brought in technicians to address “challenges” at the Caspian Sea field, which provided 78 percent of Azerbaijan’s total output in 2011.

The country’s cooperation with BP is “built on a very strong basis,” Aliyev said, describing reports of his criticism as exaggerated. “Starting from next year, our oil production will stabilize and sustainable oil production will continue for many years.”

Azerbaijan is the third-largest oil producer in the former Soviet Union, after Russia and Kazakhstan. Its output fell 10 percent last year to 45.6 million metric tons, and dropped 6.8 percent in the first 11 months of this year, the State Statistics Committee said Dec. 14.

To contact the reporter on this story: Zulfugar Agayev in Baku at zagayev@bloomberg.net

To contact the editor responsible for this story: Hellmuth Tromm at htromm@bloomberg.net

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