Azerbaijan, Baku, Dec. 17 / Trend /
AZERI-CHIRAG-GUNASHLI (ACG)
The Azeri-Chirag-Gunashli PSA was signed in September 1994. The agreement provides for the development of the contract area within 30 years. Production in the Chirag field commenced in 1997, on Central Azeri at the beginning of 2005, West Azeri at the beginning of 2006, East Azeri at the end of 2006, deepwater Gunashli in spring 2008.
Status of the project:
In January to November, 2008, Azerbaijan
International Operating Company (AIOC) produced 33mln tons of oil from the ACG field,
that is 7.4% more than in the same period of 2007. In 2007, AIOC produced 33mln tons of Azeri Light crude against 23mln tons in 2006.
On Sep. 17, BP, operator of AIOC, stopped oil production from Central Azeri and
evacuated the staff from the platform due to gas emissions around the platform
at sea. Production in the western part of the field from the West Azeri platform
was stopped for precaution but later restored.
Currently, oil production in ACG comprises nearly 650,000 bbl per day against about
900,000 bbl before suspension of production in September. Restoration of oil
production from the Central Azeri platform is planned for late 2008-early 2009.
SHAH DENIZ
The contract on development of off-shore Shah Deniz field was signed on 4 June 1996. Shah Deniz participating interests are: ВР (operator - 25.5%), StatoilHydro (25.5%), SOCAR (10%), LukAgip (10%), NICO (10%), Total (10%), and TPAO (9%). Gas production from the field began in December 2006. Gas is transported to Georgia and Turkey through the South Caucasus gas pipeline. Azerbaijan also purchases the fuel.
Status of the project:
In 2008, about 7.7bln
cu m of gas is planned to be produced from Shah Deniz. Four wells with
potential daily production of more than 22mln cu m of gas and over 47,000 bbl of
condensate operate in the field. In 2009, another well will be put into
operation and the annual production will be brought to a peak - 8.6bln cu m.
Currently, BP is drilling a new appraisal well (SDX-5) in the field. The
project depth of the well is 6,568 meters. Drilling of SDX-5 will enable specification of the reserves in Shah Deniz, which now reach 1.2trln cu m.
Drilling is carried out by the Azerbaijani-American joint venture Caspian
Drilling Company (CDC) from the Istiglal rig. CDC is a drilling contractor of BP
for Shah Deniz.
Gas production in the first stage of development of Shah Deniz will total 180bln
cu m.
INAM
Inam participating interests were: SOCAR (50%), BP (25%), the Korean National Oil Corporation (20%) and RD/Shell (5%). Under the contract, had industrial oil reserves been found in the field, the field would have been operated for 25 years. Oil reserves were estimated there at 1.4-2bln bbl.
Status of the project:
Drilling of the second
exploration well in Inam by BP found no commercial hydrocarbon reserves. The
company eliminated the second exploration wells in this area. When drilling the
company almost reached the design depth of 5,350 meters, but no commercial hydrocarbon reserves were found.
Under the Inam PSA, two exploration wells were planned to be drilled in the
field. In 2001, the first exploration well INX-1 with project depth of 5,025 meters was drilled in the field. However, an accident took place on the well after which it was
closed. This well was credited as fulfilment of obligations. Thus, all
exploration obligations of the companies were fulfiled.
The well was drilled in the contracted area covering about 225 sq km 140km south
of Baku. Water depth in the contracted area ranges from 45 meters in the north to 200 meters in the south. Minimal depth of the so-called "bank of Inam" is four
meters.
YALAMA (block D-222)
The contract was signed on 3 June 1997. Block Yalama (D-222) is the part of the largest structure in north-east part of Caspian and is located in equal parts in the Azerbaijani and Russian sections of the Caspian Sea in 30km on offshore distance. The depth of water around Yalama differs between 80 and 700 m.
A set of agreements on additional terms of
exploration and development of the block D-222 was signed in 2003, providing
for an increase in the interests of LUKoil in the project to 80% and extending
the contract area to 3,000 sq km.
An agreement on sale of LUKoil Overseas 15% of the Yalama interests to the
French company Gaz de France was signed in 2008. At present, share holding in
the project is as follows: LUKOIL 65%, SOCAR 20% and Gaz de France 15%.
.
Status of the project:
Drilling of the second exploration well in the Yalama field began in October 2008. Drilling is ongoing to be over by January 2009.
Drilling is carried out from the Heydar Aliyev rig owned by Danish Maersk Drilling company. Drilling is operated by Overseas Operating Company Ltd. The project depth of the second exploration well is 2,650 meters. The well is drilled at a distance of 22 km from the first exploration well in Yalama 690 meters beyond the surface.
In 2004, seismic research on the block was completed and drilling of an exploration well commenced. The first exploration well was drilled in 2005. No commercial hydrocarbon reserves were found.
ABSHERON
Status of the project:
In 2008, SOCAR and French Total signed an
agreement on the basic commercial principles of a future contract to develop
the offshore prospective Absheron field. Companies intend to shortly finalize designing
of a PSA on joint development of Absheron. The project envisages cooperation
between SOCAR and Total, whose percentage in the future contract will be
distributed as 40% and 60% respectively. The contract will stipulate for
natural gas production from Absheron.
Total company is well familiar with the Absheron project, as it had been a participant
in the first contract on the field before closing. Earlier a consortium of
companies operated in Absheron operated by U.S. ChevronTexaco. This contract
involved Total, but after drilling of the well the reserves were found
commercially unattractive.
Absheron participating interests were: U.S. ChevronTexaco (operator) - 30%, SOCAR - 50% and Total - 20%.
ARAZ-ALOV-SHARG
Araz-Alov-Sharg participating interests are: BP (operator) - 15%, Norwegian Statoil - 15%, U.S. ExxonMobil - 15%, Turkish TPAO - 10%, Canadian Alberta Energy - 5% and SOCAR - 40%. Required investments make up about $4bln.
Status of the project:
The project will remain frozen until the Caspian Sea status has been agreed upon between Azerbaijan and Iran.
ASHRAFI-DAN ULDUZU
The contract on development of offshore Ashrafi-Dan Ulduzu block of fields was signed on Dec. 14, 1996. Ashrafi-Dan Ulduzu participating interests were: BP - 30%, Unocal - 25.5%, Itochu - 20%, Delta Hess - 4.5%, SOCAR - 20%.
Status of the project:
The contract was closed due to discovery of commercially unattractive volume of hydrocarbons. Currently, German company Wintershall shows interest in participation in development of Ashrafi. The company signed a memorandum with SOCAR.
ATASHGAH-YANAN-TAVA-MUGAN-DENIZ
The project to develop offshore Atashgah-Yanan-Tava-Mugan-Deniz fields was operated by Japanese JAPEX possessing 22.5% in the project. Participating interests were: SOCAR 50%, Japanese INPEX - 12.5%, ITOCHU - 7.5% and Teikoku - 7.5%. Required investments in the project are estimated at $2.3bln.
Status of the project:
The contract was closed due to commercially unattractive volume of hydrocarbons.
ZAFAR-MASHAL
The contract for development of promising offshore Zafar-Mashal field was signed between the U.S. ExxonMobil and SOCAR on Apr. 27, 1999. SOCAR possessed 50% and ExxonMobil 30%. In 2000, the remaining 20% was transferred to the U.S. ConocoPhillips. Required investments in the project were estimated at $2bln and projected volume of oil reserves at 140mln tons, of which 100mln came from Zafar and 40mln from Mashal.
Status of the project:
The contract was closed due to commercially unattractive volume of hydrocarbons.
GARABAG
The project to develop offshore Garabag field was signed on Nov. 10, 1995. Garabag participating interests were: LukAgip - 45.5%, Pennzoil - 30%, LUKOIL - 12%, Agip - 5%, SOCAR - 7.5%.
Status of the project:
The contract was closed due to commercially unattractive volume of hydrocarbons.
KURDASHI
Contract on exploration and development of the block of offshore fields Kurdashi-Araz-Deniz and Kirgan-Deniz was signed on June 2, 1998 between SOCAR - 50%, Italian Agip - 25%, Japanese Mitsui -15%, Turkish TPAO - 5% and Spanish Repsol - 5%. The reserves of each of the structures were evaluated at 90-100mln tons of oil.
Status of the project:
The project was closed due to failure to discover commercially attractive volumes of hydrocarbons.
LANKARAN-TALISH-DENIZ
The contract on development of offshore perspective structures of Lankaran-Talish-Deniz was signed on Jan. 13, 1997. The parties to the project are Total - 35%, OIEC - 10%, Wintershall - 30%, SOCAR - 25%.
Status of the project:
The project was closed due to failure to discover commercially attractive volumes of hydrocarbons.
LERIK-DENIZ
The contract on the development of the perspective offshore structure of Lerik-Deniz was signed on April 27, 1999. The parties to the contract were: SOCAR - 50%, ExxonMobil - 30%, other foreign oil companies - 20%.
Status of the project:
The project was closed due to failure to discover commercially attractive volumes of hydrocarbons.
NAKHCHIVAN
The contract on the development of the perspective offshore structure of Nakhchivan was signed on 1 Aug. 1997. The parties to the contract were ExxonMobil - 50%, SOCAR - 50%.
Status of the project:
The project was closed due to failure to discover commercially attractive volumes of hydrocarbons.
OGUZ
The contract on the development of the perspective offshore structure of Oguz was signed 1 Aug. 1997. The parties to the contract were ExxonMobil - 50%, SOCAR - 50%.
Status of the project:
The project was closed due to failure to discover commercially attractive volumes of hydrocarbons.
SAVALAN
The contract on the development of the perspective offshore structure of Savalan was signed on Apr. 27, 1999.
Status of the project:
Now the contract has not been ratified by the Parliament of Azerbaijan. The parties to the contract are ExxonMobil - 30%, SOCAR - 50%, and 20 remains undistributed.
