Caspian Drilling Company, Equinor ink contract on Karabakh field

14 March 2019 18:55 (UTC+04:00)

By Leman Mammadova

Caspian Drilling Company Ltd (CDC) and Norwegian Equinor ("Equinor Azerbaijan Karabakh BV") signed a contract on drilling operations.

The contract was signed by CDC CEO Farid Akhundov and Country Manager at Equinor Fawad Quraishi, Report informs referring to Caspian Drilling.

According to the terms of the contract, CDC will drill two wells in the Karabakh field, where Equinor, being the project operator, plans to develop the field together with the State Oil Company of Azerbaijan (SOCAR). Equinor and SOCAR hold equal shares in the project on development of Karabakh field.

Drilling of the first well will begin after reactivation of the Dede Gorgud semi-submersible drilling rig. The plant will be reactivated by CDC specialists at the company's marine base. The completion of the reactivation and the start of drilling will approximately come in the third quarter of 2019.

On May 30 of this year, SOCAR and Equinor signed two important agreements. The first agreement is a risk-service agreement on the Karabakh field in the Azerbaijani sector of the Caspian Sea, while the second agreement - a production sharing and exploration agreement on the Dan Ulduzu, Ashrafi and Aypara promising structures. The agreements envisage a 50/50 share distribution.

Expectations regarding the oil and gas reserves of the Karabakh field are great.

The Karabakh oil and gas field, discovered in 2000, is located 130 kilometers to the east of Baku. The sea depth in the field varies in the range of 250-450 meters. The initial oil reserves of the field are estimated at 100 million tons.

The recoverable reserves of the Karabakh field are estimated at 16 million tons of oil and 28 billion cubic meters of gas. The sea depth in the area of the field is 180 meters.

About 60 percent of work on the new offshore platform for the Karabakh field have been completed. The first product from the Karabakh field is expected in 2020-2021.

CDC was established in 1996 between the SOCAR (55%) and Santa Fe (45%) on the basis of a world-famous USSR Offshore Exploration Drilling Company (OEDC) to perform drilling operations in the Caspian region and follow up an execution of Product Sharing Agreement in Azerbaijani Sector of Caspian Sea.

It should be reminded that Norway's Statoil oil and gas group changed its name to Equinor on May 16, 2018.

The company owns 7.27 percent of the Azeri-Chirag-Guneshli (ACG) bloc development project in the Azerbaijani sector of the Caspian Sea and 8,71 percent in the Baku-Tbilisi-Ceyhan (BTC), the main export route for ACG oil.

Equinor is also cooperating with Azerbaijan in the development of renewable energy sector. Recently, Energy Ministry of Azerbaijan and Equinor signed a Memorandum of Understanding for the cooperation on renewable energy.

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Leman Mammadova is AzerNews’ staff journalist, follow her on Twitter: @leman_888

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