AIOC signs contracts on Azeri Central East project
By Leman Mammadova
The Azeri Central East (ACE) project, which is the next stage in the development of the Azeri-Chirag-Gunashli giant block (ACG) in the Azerbaijani sector of the Caspian Sea, targeted to achieve daily production at the peak of up to 100,000 barrels of oil and 350,000 cubic feet of gas.
Azerbaijan International Operating Company (AIOC) signed contracts worth $1.7 billion for design and construction of facilities, including engineering, fabrication and construction, project management and other services, within the framework of the ACE project. The contracts have been concluded following the project final investment decision in April 2019.
In particular, a contract was signed with a consortium of BOS Shelf/Star Gulf FZCO LLC for the fabrication of the jacket and skirt piles for the ACE platform.
The value of this contract is around $260 million. The construction work under the contract has already begun and will be completed in 2021.
Another contract has been concluded with Azfen for the fabrication and integration of the topsides unit for the ACE platform, which worth more than $486 million. The construction work has already begun and is expected to be completed in 2022
AIOC also signed a contract with the American company National Oilwell Varco (NOV) for the engineering, procurement and construction supervision design, supply of equipment and control over the drilling facility for the topsides of the ACE platform. The contract costs at $151 million.
The engineering, procurement and construction of the living quarters for the ACE platform will be carried out by the Swiss company Emtunga Solutions AB, with whom a $34 million contract was signed. The work under this agreement has already commenced and will be completed in 2022.
Moreover, AIOC signed a contract worth over $76 million with SOCAR-KBR LLC for execute engineering within ACE project. The work has started and is being performed through SOCAR-KBR’s UK Leatherhead and Baku engineering offices.
The next contract has been signed with Transglobal Projects (TGP) LLC for cargo management services. The scope of work includes assembly of the materials and equipment from the suppliers’ locations and delivery to Baku sites, including customs clearance.
As of April 19, 2019, the shareholders of the ACG field block development project signed a final investment decision on the ACE project. The $6 billion development 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 up to 300 million barrels over its lifetime.
ACE project is centred on a new 48-slot production, drilling and quarters platform located mid-way between the existing Central Azeri and East Azeri platforms in a water depth of approximately 140 meters. The project will also include new infield pipelines to transfer oil and gas from the ACE platform to the existing ACG Phase 2 oil and gas export pipelines for transportation to the onshore Sangachal Terminal.
In addition, there will be a water injection pipeline installed between the East Azeri and ACE platforms to supply injection water from the Central Azeri compression and water injection platform to the ACE facilities.
Construction activities, which will commence this year and run through mid-2022, will take place in-country utilizing local resources. It is expected that at peak, construction activities will create up to 8,000 jobs.
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Leman Mammadova is AzerNews’ staff journalist, follow her on Twitter: @leman_888
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