SOCAR and Equinor signed two oil contracts

Baku/30.05.18/Turan: The State Oil Company of Azerbaijan (SOCAR) and the Norwegian Equinor (formerly Statoil) signed two agreements on joint development of areas in the Azerbaijani sector of the Caspian Sea on May 30. In particular, a Production Shearing (PSA) Agreement was signed for the exploration and development of the promising structure "Dan-Ulduzu-Ashrafi-Aypara". A contract for the development of the Karabakh field was also signed by the Risk Service.

The agreements were signed by SOCAR president Rovnag Abdullayev and executive vice president of Equinor Tim Dodson. Drilling of the exploration well on "Garabagh" is planned in 2018, the beginning of production - in 2021, SOCAR said. "The contracts signed today are of great importance for stabilizing oil production in Azerbaijan and meeting the growing demand for gas in the country," Abdullayev said.

"Both fields are located in a well-known area near the Azeri-Chirag-Gunashli block, and we plan to work with SOCAR on these new projects," said Eldar Saetre, President of Equinor. To implement the projects, SOCAR and Equinor will create an operating company on parity shares (50% to 50%).

The Karabakh field, whose recoverable reserves are estimated at 16 million tons of oil and 28 billion cubic meters of gas, is located 130 km east of Baku. The depth of the sea in the area of ​​the deposit is 180 meters. This field has already signed a contract with foreign companies in the past. In the summer of 1996, SOCAR formed with the foreign partners the consortium Caspian International Petroleum Company - CIPCO. It included Russian-Italian LUKAgip, American Pennzoil, bought later by British Royal Dutch Shell, Russian Lukoil, Italian Agip.

However, on February 23, 1999 the contract was canceled due to the refusal of foreign shareholders who considered the reserves to be commercially unattractive at the then oil prices of $ 10-12 per barrel. In exploration work, foreign shareholders invested up to $ 130 million. The Ashrafi field was discovered in 1999. It is located 100 km to the east of Baku. In 1997, SOCAR signed a contract to develop a block of Ashrafi-Dan-Ulduzu structures with BP (30%), Unocal (25.5%), Itochu (20%) and Delta HESS (4.5%). The share of SOCAR in this project was 20%. Within the scope of exploration work at Ashraf, small hydrocarbon reserves of about 20-40 million tons were identified. The contract lost its validity on March 7, 2000. -06D--