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Exploration work within the contract on exploration, development and production sharing on the prospective block "Shafag-Asiman" in the Azerbaijani sector of the Caspian Sea is conducted in accordance with the prescribed plan, the President of SOCAR (State Oil Company of Azerbaijan) Rovnag Abdullayev said at the meeting with BP Chief Executive Robert Dudley.
The SOCAR and BP signed the PSA for a period of 30 years. The exploration period is 4 years with possible prolongation for another 3 years. The first stage of exploration works envisions drilling of two wells. The second one assumes drilling of two more wells, if necessary. As the sides go over to the production stage, they will operate the project jointly. The two companies hold equal interests in the project.
During the meeting, Abdullayev said that the contract signed between the sides, had already been recommended to be ratified by the Parliament of Azerbaijan. The SOCAR President expressed confidence that the document will be ratified soon.
The reserves of field Asiman-Shafag are estimated at 500 billion cubic meters of gas and 65 million tons of condensate.
"Shafag" and "Asiman" structures are located 125 kilometers to the south-east of Baku. SOCAR and BP signed a memorandum on "Mutual understanding" on the joint exploration and development of "Shafag" and "Asiman" in London in July 2009.
Exploration work has not been conducted on the block before. It is located in the depth of 650-800 m. with the depth of the reservoir at 7,000 meters.
Also during the meeting the sides discussed the preparatory work as part of the second stage of development of Azerbaijani Shah Deniz gas field, the issues of transportation of Azerbaijani gas to Europe, the possibilities of cooperation of SOCAR and BP in projects in Azerbaijan and neighboring countries.
The Shah Deniz field's gas reserves are estimated at 1.2 billion cubic meters, while condensate - 240 million tons.
The contract to develop the offshore Shah Deniz field was signed June 4, 1996. Participants to the agreement are: BP (operator) - 25.5 percent, Statoil - 25.5 percent, NICO - 10 percent, Total - 10 percent, LukAgip - 10 percent, TPAO - 9 percent, SOCAR-10 percent.
BP is the main foreign oil investor in Azerbaijan. It heads the projects to develop the block of oil and gas fields "Azeri-Chirag-Guneshli" and gas condensate field Shah Deniz. BP is also an operator of the Baku-Tbilisi-Ceyhan and Baku-Supsa pipelines.
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