BP Azerbaijan talks exploration activities

11 February 2020 15:57 (UTC+04:00)

By Rasana Gasimova

BP Azerbaijan will spend nine months on drilling work in the Shafag-Asiman offshore block, the company said in its annual report published recently.

Following the drilling, the well data will be analyzed and, if successful, an evaluation programme may be conducted to confirm the results, BP said.

The first exploration well was spudded on January 13, 2020 by BP that operates the Shafag-Asiman offshore block.

The company also informed that 3D seismic acquisition programme on D230 block commenced in December 2019. These activities are currently ongoing. It is expected that the programme will be completed in the 1st half of 2020. 

 This will be followed by the processing and interpretation of the acquired data. Based on the results of the seismic survey BP will begin planning of the first exploration well in 2020.

“In the Shallow Water Absheron Peninsula planning for the exploration wells drilling in the selected three prospective areas is ongoing with the view to commence drilling activities later this year once the upgrade of the rig selected to drill the first well is completed,” the report reads.

BP noted that in 2019, Shah Deniz spent about $544 million in operating expenditure and $1.1 billion in capital expenditure, the majority of which was associated with the Shah Deniz 2 project.

During the year, the Shah Deniz field produced around 16.8 billion standard cubic metres (bcm) of gas and 3.5 million tonnes (28.6 million barrels) of condensate in total from the Shah Deniz Alpha and Shah Deniz Bravo platforms.

Production from Shah Deniz Bravo has been ramping up since the first gas delivery at the end of July 2018.

The existing Shah Deniz facilities’ production capacity is currently over 56 million standard cubic metres of gas per day or more than 20 bcma.

In 2019, Shah Deniz 2 project achieved final acceptance of offshore and onshore facilities. The project team continued to support operations through the first year of production to ensure high operating efficiencies of the Shah Deniz 2 assets.

“During the year the project continued to perform subsea construction activities, including installation of infrastructure to the deep-water flanks to support the next East South flank start-up in 2021. Delivery of subsea assets and installation activities using the subsea construction vessel Khankendi and the pipelay barge Israfil Huseynov will continue over the coming years to deliver plateau gas production,” the company noted.

Shah Deniz participating interests are: BP (operator – 28.8 per cent), TPAO (19.0 per cent), AzSD (10.0 per cent), SGC Upstream (6.7 per cent), PETRONAS (15.5 per cent), LUKOIL (10.0 per cent) and NICO (10.0 per cent).

Further, the report says that in 2019, SCP spent about $48 million in operating expenditure and about $34 million in capital expenditure in total.

During 2019, the daily average throughput of SCP was 29 million cubic metres of gas per day.

The SCP Co. shareholders are: BP (28.8 per cent), TPAO (19 per cent), AzSCP (10.0 per cent), SGC Midstream (6.7 per cent), PETRONAS (15.5 per cent), LUKOIL (10 per cent) and NICO (10 per cent).

In 2019, Baku-Tbilisi-Ceyhan pipeline spent approximately $138 million in operating expenditure and about $44 million in capital expenditure.

BP informed that since the 1,768 km BTC pipeline became operational in June 2006 till the end of 2019, it carried a total of more than 3.35 billion barrels (more than 447 million tonnes) of crude oil loaded on 4,381 tankers and sent to world markets.

In 2019, BTC exported around 233 million barrels (about 31 million tonnes) of crude oil loaded on 296 tankers at Ceyhan.

In the meantime, the Sangachal terminal exported about 263 million barrels of oil in 2019 - about 235 million barrels through Baku-Tbilisi-Ceyhan (BTC) and about 28 million barrels through the Western Route Export Pipeline (WREP).

According to BP, the daily capacity of the terminal’s processing systems is currently 1.2 million barrels of crude oil and about 80 million standard cubic metres of Shah Deniz gas, while overall processing and export capacity for gas, including ACG associated gas is around 100 million standard cubic metres per day.

In 2019, BP spent about $567 million in operating expenditure and $1,476 million in capital expenditure on ACG activities.

In April 2019, the next stage of development of the ACG field was started with a $6 billion project which includes a new offshore platform and facilities designed to process up to 100,000 barrels of oil per day. The project is expected to achieve first production in 2023 and produce incremental up to 300 million barrels of oil over its lifetime. 

ACG produced on average about 535,000 barrels per day last year. At the end of 2019, 125 oil wells were producing, while 46 wells were used for water and seven for gas injection. ACG completed 10 oil producer wells and one water injection well.

“During the year, ACG delivered an average of 5.7 million cubic metres per day of ACG associated gas to SOCAR (2.1 billion cubic metres in total), primarily at the Sangachal Terminal but also to SOCAR’s Oil Rocks facility. The remainder of the associated gas produced was re-injected for reservoir pressure maintenance,” the report stated.

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