Natural Recourses

Azerbaijan is rich in mineral resources, the most important of which is oil. The main oil fields are on Apsheron Peninsula and the Caspian Shelf. The richest deposits of oil have been discovered in the aquatics to the south of Apsheron. Oil fields situated to the north of Apsheron Peninsula in Siyazan and to the west and southwest of Apsheron in Gobustan, Shirvan and Salyan have the most prospective structure. Not far from Ganja (in Naftalan) are the fields of unique modification of medicinal oil. Of great importance is the associated natural gas.
Azerbaijan is one of the world's oldest oil-producing countries. The country's oil industry experienced a boom at the end of the 19th and the beginning of the 20th century. During World War II, the Soviet Republic of Azerbaijan produced approximately 500,000 barrels per day. However, oil production in Azerbaijan dropped off dramatically in the post-war years as the Soviet Union directed resources for energy development to other regions. In addition, due to extensive oil development combined with a lack of environmental protection measures, Azerbaijan's coastline and the Caspian Sea suffered heavy environmental damage during the Soviet era. The years of independence marked a new era of oil exploration and production
Azerbaijan has in some 11 to 30 trillion cubic feet (Tcf) of proven natural gas reserves (depending on the source consulted). However, there is insufficient infrastructure to move associated gas from many of the Caspian offshore oil fields and some of it is being flared.
In 1999, Azerbaijan passed a law requiring planning for associated gas exploitation to go with each oil project. In October 1999, SOCAR and TDA signed a $425,000 agreement to help fund a comprehensive natural gas study. The Shah Deniz natural gas field, which was discovered in 1999, is estimated to contain between 25 Tcf and 39 Tcf, making it the largest find of the last 20 years. The estimated cost for development and infrastructure at Shah Deniz is $4.5 billion and the first production is expected by 2006. The annual production rate is expected to be 286 billion cubic feet (Bcf).
Of the other natural gas fields in Azerbaijan, the Nakhchivan field is estimated to contain 900 Bcf in reserves. There is also a natural gas reserve at Gunashli field.
Over 95% of Azerbaijan's gas production comes from offshore fields, rather than onshore. The Bakhar natural gas field currently accounts for more than 40% of Azerbaijan's natural gas production but the production of that field is declining because of a lack of new drilling. It is expected that increased future production will come from the Nakhchivan, Gunashli, and Shah Deniz fields. Currently, SOCAR produces some 85% of Azerbaijan's natural gas, and AIOC produces a small amount of associated gas (i.e. natural gas found with crude oil deposits).
Azerbaijan has no significant coal deposits, nor any domestic coal production. Azerbaijan consumes only a small amount of coal and consumption has declined from over 26,400 tons in 1992 to just 1,100 tons in 2000.
Azerbaijan is, however, rich in iron and aluminum ore, pyrite, molybdenum, arsenic. The deposits of polymetalic ores on Filizchay (Greater Caucasus) in the upper part of Belokanchay valley are of commercial importance. The richest deposits of iron ore (Dashkesan) and alunite (Zaglic) are in the mountains of the Lesser Caucasus.
Nearby, in the Dashkesan-Ganja district are considerable deposits of cobalt ore and pyrite.
Nakhchivan is rich in salt and poly-metal. The salt deposits in the Negram field are estimated at 2-2.5 billion tons. Molybdenum is extracted in Paragachay and arsenic ore in Negram.
Azerbaijan also has mineral deposits for use as building materials. On the slopes of the Lesser Caucasus marble is extracted, though its quality is inferior to Carr marble. Deposits of gravel, sand, lime, fire-proof and brick-red clay and loam are being worked on the Apsheron Peninsula. The deposits of construction stone in the Republic are estimated to 300 billion tons (Gyuzdeck, Mardakyan, Dovletyari, Dilagarda, Shahbulag, Naftalan, Dash Salakhly) and some 24 million tons of facing stone (Gyulbakht, Dashkesan,Shakhtakhty,Kilably).
The number of hot and mineral springs of Azerbaijan runs into the many thousands. The best known springs are at Istisu, Turshsy, Badamli, Galalty, Shikhburnu, Surakhany.