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ACG still has billions more barrels to recover: Wood Mackenzie

20 September 2019 [14:44] - TODAY.AZ

By Trend


There are still billions more barrels to recover and billions of dollars to invest in Azeri-Chirag-Gunashli (ACG), Ashley Sherman, Principal Research Analyst – Caspian & Europe at Wood Mackenzie research and consulting company told Trend.

He made the remarks on the occasion of the 25th anniversary of signing of the Contract of the Century.

“The 25th anniversary of the ACG ‘Contract of the Century’ is a moment to celebrate the past and look to the future. There are very few individual oil fields that have had such a key role in shaping their country’s recent economic path. 25 years is a long time in the oil business, but it is not even half time for the ACG agreement – all thanks to the landmark contract extension signed in 2017,” said Sherman.

He noted that ACG production is currently below 550,000 b/d.

“But, with 30 more years to contract expiry in 2049, there are still billions more barrels to recover and billions of dollars to invest. On top of the 3.5 billion barrels already produced and $36 billion already invested,” said Sherman.

He went on to add that approval of the $6 billion Azeri Central East (ACE) development phase was a fitting way to mark the 25th anniversary.

“This latest investment showcases the continued impact of the ACG megaproject – competitive commercial returns for BP and partners; construction activity and employment in Azerbaijan; and additional revenues for Azerbaijan’s Oil Fund and economy,” said Sherman.

Azerti-Chirag-Gunashli (ACG) is celebrating its 25th anniversary in 2019.

25 years ago, on September 20, 1994, the Government of Azerbaijan and a group of international oil companies representing eight countries signed the Azeri-Chirag-Gunashli Production Sharing Agreement, which later became known as the “Contract of the Century”. The Contract was extended in September 2017 until mid-century.

From the start of production in November 1997 till the end of 2Q 2019, ACG produced about 488 million tonnes (more than 3.6 billion barrels) of oil.

ACG participating interests are: BP (30.37 percent), SOCAR (25 percent), Chevron (9.57 percent), INPEX (9.31 percent), Equinor (7.27 percent), ExxonMobil (6.79 percent), TPAO (5.73 percent), ITOCHU (3.65 percent), ONGC Videsh Limited (OVL) (2.31 percent).

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