ACG partners in Azerbaijan negotiate to produce deep-laying gas

"We intend to hold negotiations on the base of our commercial proposals [ ] and do not expect counter alternative proposals," the source said.

The SOCAR has already submitted commercial proposals to partners of the Azerbaijani offshore Azeri-Chirag-Guneshli oil fields to develop a deep laying-gas in this block of fields and partners have already examined this, SOCAR's senior official said earlier. "We met and they
[partners] have definite questions on our proposals. We are ready to discuss these issues with them," the source said.

The source did not divulge the volume of investment which is necessary to implement the project. "This issue concerns free deep-laying gas and a deep enough drilling will be conducted," the source said.

The source said the SOCAR's proposals are a new approach, not recorded in the previous contracts.

It is not necessary to sign a new agreement to realize the project. It will be implemented as part of the existing PSA contract signed in 1994.

Deep-laying gas reserves in the ACG field are estimated at 500 billion cubic meters. Under the contract signed by Azerbaijan in 1994, BP and its partners on the project "ACG" have the right to develop oil horizons to "break svita". At the same time, as stated in the contract, the development of the lower levels is the subject of another agreement.

Under the agreement, which was signed with Azerbaijan in 1994, BP and its partners will develop oil horizons to Pereriv series. Lower horizons will be developed in accordance with a new agreement. There are hydrocarbon resources in Nadkirmakin, Podkirmakin and Gala series. According to Azerbaijani geologists, this is a gas and condensate. There may be discovered an oil ring, which will be additional liquid hydrocarbon resources.

The sides to the production sharing agreement on the Azeri-Chirag-Gunashli fields are BP (operator- 34.14 percent), ChevronTexaco (10.2 percent), SOCAR (10 percent), INPEX (10 percent), Statoil Hydro (8.56 percent), ExxonMobil (8.01 percent), TPAO (6.75 percent), Devon (5.63 percent), Itochu (3.92 percent) and Delta Hess (2.72 percent). Required investments total $20 billion.

/Trend Capital/