Azernews.Az

BAKU – Oil majors Inpex and Chevron have agreed to buy additional stakes in Azerbaijan's Azeri-Chirag-Gunashli (ACG) oil field development project in the Caspian Sea from Devon Energy Caspian Corp., which is exiting the project.

Inpex and Chevron will acquire an additional 0.96% and 0.99% in the ACG project respectively.

Devon Energy will sell all of the 5.63% stake it holds in the ACG project, which will be split among four of the project partners. The operator, BP Plc. (BP), will take 3.29%, Chevron Corp. will purchase 0.99% and Itochu Corp. will get 0.38%, Inpex said in a statement.

After the acquisition, Inpex's holding will become 10.96%, while BP, Chevron and Itochu will hold 37.43%, 11.27% and 4.30% respectively.

The remainder is held by Azerbaijan's state oil company SOCAR, with 10%, Statoil ASA with 8.56%, ExxonMobil Corp. with 8.00%, the Turkish Petroleum Corp., or TPAO, with 6.75% and Hess Corp. with 2.72%.

The ACG project has been producing crude oil since 1997 from several phases of the three oil fields – Azeri, Chirag and Gunashli. In March this year, the partners made a final investment decision on additional output from the Chirag oil field with commercial production slated to start in 2013.

The BP-run consortium AIOC plans to produce an average of 854,000 barrels per day from the five ACG platforms in 2010.

Chevron stake
US oil major Chevron has announced that its subsidiary, Chevron Khazar Ltd, has exercised its pre-emptive rights to acquire a portion of Devon's interest in the ACG.

"We're delighted to achieve this acquisition and increase our commitment to Azerbaijan," Chevron's Country Manager in Azerbaijan Bob Dastmalchi said.

"This acquisition gives us an opportunity to further strengthen Chevron's presence in the country".

Meanwhile, BP announced it had completed the acquisition of Devon Energy’s additional interest in the ACG project.

According to BP Azerbaijan, the acquisition is part of the company’s long-term commitment in the strategically important Caspian region.

"The acquisition of the additional interest in Azerbaijan is part of BP’s commitment to the Caspian region as a core strategic area where we already hold a strong position and intend to enhance this significantly in the future," said Rashid Javanshir, BP Azerbaijan President.

"Another equally important example of this intention is the Heads of Agreement (HOA) which we recently signed with SOCAR in Baku to define the basic commercial principles for a new production sharing agreement to jointly explore and develop the Shafag and Asiman offshore block in the Caspian," Javanshir added.

On March 11 BP announced a broad-ranging deal, in which BP agreed to pay Devon Energy $7.0 billion in cash for assets in Brazil, Azerbaijan and the US deepwater Gulf of Mexico. The Azerbaijan element is the third to be completed so far, following completion of acquisition of assets in the Gulf of Mexico and the sale of a 50 per cent stake in BP’s Kirby oil sands interests in Canada. The purchase of assets in Brazil has yet to be completed.