ADB played an important role in country risk mitigation. ADB’s partial credit guarantee (PCG) to the Southern Gas Corridor Closed Joint-Stock Company (SGC) made possible SGC’s access to necessary private sector refinancing to meet its financial commitments to Shah Deniz Stage II (SD2) and the midstream pipelines. This reduced government dependence on the country’s dwindling oil and gas revenues held by the State Oil Fund of the Republic of Azerbaijan (SOFAZ) to meet expenditure obligations. ADB contributed to ensuring that SGC could continue carrying on its balance sheet all government participation interests in the project and in the midstream pipelines. This also helped ensure that the government’s social development and economic diversification programs were not disrupted during and in the wake of the 2014–2015 economic downturn in the country.
Shah Deniz Gas Field Expansion Project