SOCAR, Total ink deal on tapping Caspian gas field
Azerbaijan's state energy firm SOCAR and French major Total SA have
signed an agreement on joint development of the Absheron gas field
in the Caspian Sea.
According to the agreement that envisions exploration and production sharing from the field, Total will control 60% of the project and SOCAR the other 40%, the Azerbaijani company said.
The sides have said the first stage of their joint activity on developing the prospective block carried out under a memo signed in February 2007 was fruitful and pledged to continue successful cooperation during the new stage.
SOCAR president Rovnag Abdullayev told the signing ceremony that at a time the demand for natural gas in world markets is rising, developing the Absheron field which is said to contain considerable gas and condensate reserves was of particular importance.
The parties regarded as remarkable the interest in tapping the field taken by Total, one of the participants in the previous agreement that was invalidated in 2005. The French company's participation is due to its confidence in the potential of the fields in the Azerbaijan sector of the Caspian that are flush with hydrocarbon reserves. It was also noted that SOCAR and Total have gained useful experience of cooperation in the implementation of such large-scale energy projects as the development of the Azeri-Chirag-Gunashli (ACG) fields, the BTC main oil export pipeline and tapping the country's biggest gas-condensate field Shahdaniz. The newly-signed PSA heralds the outset of further expansion of such cooperation.
The block is in the Caspian Sea, 100 kilometers from Baku, in a water depth of around 500 meters.
Total and U.S. energy firm Chevron Corp. had previously signed a deal in 1997 to develop the Absheron field, estimated at the time to contain between 1 trillion and 3 trillion cubic meters of gas and nearly 120 million metric tons of oil. Chevron held a 30% stake in the project, while Total - 20% and SOCAR 50%. One well had been drilled at the field, but the two foreign companies subsequently refused to drill another one and abandoned the project in 2001 after determining it was not commercially viable.
According to the agreement that envisions exploration and production sharing from the field, Total will control 60% of the project and SOCAR the other 40%, the Azerbaijani company said.
The sides have said the first stage of their joint activity on developing the prospective block carried out under a memo signed in February 2007 was fruitful and pledged to continue successful cooperation during the new stage.
SOCAR president Rovnag Abdullayev told the signing ceremony that at a time the demand for natural gas in world markets is rising, developing the Absheron field which is said to contain considerable gas and condensate reserves was of particular importance.
The parties regarded as remarkable the interest in tapping the field taken by Total, one of the participants in the previous agreement that was invalidated in 2005. The French company's participation is due to its confidence in the potential of the fields in the Azerbaijan sector of the Caspian that are flush with hydrocarbon reserves. It was also noted that SOCAR and Total have gained useful experience of cooperation in the implementation of such large-scale energy projects as the development of the Azeri-Chirag-Gunashli (ACG) fields, the BTC main oil export pipeline and tapping the country's biggest gas-condensate field Shahdaniz. The newly-signed PSA heralds the outset of further expansion of such cooperation.
The block is in the Caspian Sea, 100 kilometers from Baku, in a water depth of around 500 meters.
Total and U.S. energy firm Chevron Corp. had previously signed a deal in 1997 to develop the Absheron field, estimated at the time to contain between 1 trillion and 3 trillion cubic meters of gas and nearly 120 million metric tons of oil. Chevron held a 30% stake in the project, while Total - 20% and SOCAR 50%. One well had been drilled at the field, but the two foreign companies subsequently refused to drill another one and abandoned the project in 2001 after determining it was not commercially viable.
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