Press Release

on the first reports of the audit company Deloitte & Touche

The Coalition of Azerbaijan NGOs “For Improving Extractive Industry Transparency”

March 31, 2005

On March 15, 2005 the independent audit company Deloitte & Touche announced its reports for the publication of the Azerbaijan Government’s first reports (2003 annual assertion and 2004 first 6-months assertion)

The publication of Azerbaijan’s EITI reports follows the signing of a Memorandum of Understanding (‘’MOU’’) on November 24, 2004 between the Government of Azerbaijan, foreign and local extractive industry companies and a coalition of some 32 local Non-Governmental Organisations (‘’NGO’s’’) for Increasing Transparency in Extractive Industries to implement EITI in Azerbaijan. The MOU set out a clear and independent process for the implementation of EITI in Azerbaijan and since its signing has served as the framework for implementation efforts by all parties.

The full report as well as the Aggregator’s opinion on the document has already been disclosed on the State Oil Fund (SOFAZ) website: http:// www.oilfund.az and the EITI Secretariat of the UK Department for International Development (DFID) website: http:// www.eitransparency.org/implemetation.htm and the Non-Governmental Organizations (NGOs) Coalition for Increasing Transparency in the Extractive Industries of the Republic of Azerbaijan website: http:// www.eiti-az.org .

After analysing the Independent Accountants’ Reports for the year ended 31 December 2003 and for the six months ended 30 June 2004, the Coalition Council comments upon them as:

1. The Independent Accountants’ Reports cover only the activities of the companies which work under PSAs. Thus the information about only a part of the Azerbaijan oil revenues received from the exploitation of oil and gas fields in 2003 and 2004 (half year) years are disclosed (i.e. activities of SOCAR are not taken into account). This breaks the principles of the MOU and deprives the Azerbaijan society from the comprehensive information regarding the revenue received from the exploitation of oil and gas fields which are our national wealth;

2. The independent accountants’ Reports bring up a number of serious questions. Those questions are related to some incomprehensible expressions, as well as to the discrepancies in figures.

3. The independent accountants’ Reports are required to be considered in detail with the participation of all the parties to the Memorandum in a short time;

4. The primary experience gained from the Reports shows obviously the importance of the implementation of a number of suggestions made by the NGO Coalition in June 11, 2004. And this makes the reconsideration of the reporting forms necessary.

In consideration of the notes above the Coalition Council came to a decision to address to other parties to the Memorandum and also to the audit company with appropriate inquiry and suggestions.

Sənədin sonuncu korrektə tarixi: 7/7/2008 - 11:32:50