Abstract:
Azerbaijan is one of the few regions in the world where petroleum resources have been obtained and put into use for a thousand years. There have been various stages in the growth of the region’s oil & gas industry, each with its unique set of achievements. While the history of natural resources extraction in Azerbaijan starts back in ancient times, the main development stages cover the period from the middle of the nineteenth century when for the first time in the world oil field was drilled with an industrial method, in Baku, until current times when the oil & gas industry is the main aspect of the republic’s economy. At the same time when we talk about the history of petroleum in Azerbaijan, it is impossible not to mention the Foreign Direct Investment (FDI). Azerbaijan with its rich natural resources from the nineteenth century was at the center of attraction of foreign investors such as Nobel Brothers, Rothschilds, and British Petroleum which, by investing in hydrocarbons of the nation, were able to succeed as well as write their names in the history of the industry. Although during the beginning of the 1990s the sector was in a situation of crisis due to a lack of investments, infrastructure, and attention, the right decisions and FDI were the main aspects leading to significant development. There are many leading oil & gas companies from different parts of the world involved in the FDI of the country’s industry, however, British Petroleum (BP) is the one that stands between the others with its notable investments. This study will analyze the development stages through which the oil & gas industry of the nation passed to reach its current stage where the sector is the lifeblood of the economy. In this research paper, we will understand the value of petroleum for Azerbaijan, the factors and challenges that the industry faced in its development path, and the role of FDI in this process. In addition to this, the study will be supported by the analyses of the British Petroleum (BP) case in Azerbaijan which contributed considerably to the modernization and evolution of the industry.
