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Azim Azimov

AZERBAIJAN - Industry

On a Roll

Chairman of the Board, Azerboru JSC

Bio

Azim Azimov graduated from the Dnepropetrovsk Metallurgical Institute in 1982, specializing in mechanical equipment for metallurgical plants. He began his career at Azerboru JSC as a Master’s Assistant and worked his way up to General Manager. Since 2002 he has held the position of Chairman of the Board. He obtained his PhD in Technical Science in 2011, and is the author of more than 20 scientific publications and hundreds of rationalization proposals.

"Our historical markets are Russia, Kazakhstan, Turkmenistan, Uzbekistan, and other oil-producing countries."

Azerboru JSC was founded in 1947 and has carried out an ambitious development program over the last few years. How has the company’s profile evolved over the years?

Our company was founded in 1947, establishing a pipe-rolling plant in Sumgait city, on the shores of the Caspian Sea. It was the first company in the ferrous metallurgy industry in Azerbaijan. On the eve of 1952, the first pipe mill was commissioned—“mill 140″. In 1957 and 1959, the next two mills “250-1” and “250-2” were brought online. The first Azerbaijani seamless steel pipes were made in 1952, and, since then, the main products of the plant have been drill pipes, casing, tubing, as well as line and service pipes. Azerboru JSC achieved a strong reputation across the Soviet Union, exporting almost all its production to the other republics. However, after the collapse of the Soviet Union, we started to lose our historical markets, and by the end of the 1990s production almost halted at the plant. Our main strategy over the last decade, especially since 2005 when we started rehabilitating the plant, has been to get back on our feet, reestablish the whole production chain, and expand our business activity abroad.

What strategies did you implement to restructure the company and return its export profile?

In the last few years we have invested in widening our product portfolio in terms of pipe diameters, wall thicknesses, and so on. We have also focused on obtaining international standards to expand our exports. In this regard, we have upgraded one of the three mills the plant has, and at the moment the production capacity of this mill is 200,000 tons a year. We believe that the potential of the market will enable us to further increase our production and triple sales in the near future. In this regard, we are mainly an export-oriented company, and the investments we did during the crisis period will enable us to regain our position in foreign markets, starting from the CIS region.

“Our historical markets are Russia, Kazakhstan, Turkmenistan, Uzbekistan, and other oil-producing countries.”

What foreign markets is Azerboru JSC eying for the future?

Our historical markets are Russia, Kazakhstan, Turkmenistan, Uzbekistan, and other oil-producing countries. Since 2005, we have started to export again to these markets, increasing the overall export figures year by year, for we currently export 97% of our products. In this regard, we are opening up European markets after obtaining the right international standards to operate in them, and we have already successfully supplied pipes to German, Austrian, and Italian companies, and are expecting to increase our volume of trade and exports in 2012. At the same time, we are currently working on obtaining American Petroleum Institute standards for our products, which will enable us to open up another important market.

How significant is your expenditure on R&D?

When we decided to rehabilitate the production plant in Sumgait, we realized the importance of acquiring both national and international standards, as well as of the importance of quality and product control. We have set up a quality control system over the whole production chain, and we are constantly upgrading it, as well as purchasing the most modern equipment. We also set up our own laboratory facilities, where we test all our products. Another point is to have a qualified and experienced workforce to manage and control the quality process. Over the years we have obtained the ISO 9001:2008 certificate for management, and we are providing our employees with both national and international training courses, and in 2011 more than 20 people undertook professional courses outside the plant and 160 more gained specific skills qualifications. Also, Azerboru JSC has its own training center for our freshly hired employees. The fact that in 2011 we supplied our products to leading companies such as Lukoil, Gazprom, SOCAR, and Uzenmunaygaz without any quality complaints speaks volumes about the significance of our investment in these fields.

What investment and growth plans does Azerboru JSC have for the future?

In 2011 we tripled our annual production compared to our results in 2010 and we hired almost 300 people. Our main target for the near future is to increase production and sales, and so potentially we can increase production up to 600,000 tons a year and the number of employees by 50%. Since we are already producing different types of pipes, our aim is to widen our product portfolio beyond this product. Back in the old days, we used to produce steel billets, our raw material for the construction of pipes. However, we are not considering setting up a steel billet production line in the future, because we are closely working with Det.Al Holding, which has vast reserves of iron ore and is currently developing a major metallurgic project in Ganja, which will be fully operative in two to three years time, enabling us to acquire cheaper raw material inputs for our production.

© The Business Year – February 2012

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