Bp expands its holdings in caspian sea – caspian news k electric jobs 2016

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More than a week has passed since the signing of new production sharing agreement between the British energy giant BP and SOCAR, the state oil company of Azerbaijan, in the presence of Azerbaijan’s President Ilham Aliyev and UK Prime Minister Theresa May in London, regarding Caspian energy resources, and analysts continue to weigh in on the motives behind the big deal.

“There are only nine companies in the world who owns all necessary technological basis and experience in exploring and developing the fossil fuel deposits. And BP is one of them,” Ilham Shaban, who leads the Caspian Barrel Oil Research Center in Baku, told Caspian News, commenting on the agreement that was signed in London on April 26.

“After the prices of oil started falling in 2014, BP was the first company to present a commercial offer to the Azerbaijani government on investing in exploration activities in the Caspian Sea. BP’s proposal was the best,” Shaban added. “We may say the same about the most recent deal – BP has come up with the most competitive commercial offer and won the next agreement with Azerbaijan.”

The new BP-SOCAR deal is focused on the exploration and development of Block D230 in the North Absheron basin in the Azerbaijan sector of the Caspian Sea. The block’s area is estimated at around 3,200 square kilometers, and it sits anywhere between 400 and 600 meters beneath the water’s surface, while the reservoir depth is estimated to be around 3,500 meters.

“This agreement underpins a new joint effort by SOCAR and BP to explore further Caspian opportunities in support of long-term production in Azerbaijan,” BP group chief executive Robert Dudley said after deal’s signing, according to BP’s official website.

“We have now been operating in the region for more than 25 years and believe there is still significant oil and gas potential there. We look forward to continuing to build on our significant business in Azerbaijan, working closely with SOCAR and others to explore and help secure the Caspian’s future for decades to come."

“I believe that the synergies between modern upstream technology and unique historical experience, embodied in both companies, create a solid basis for our continued success,” SOCAR’s president Rovnag Abdullayev said after inking the deal, according to SOCAR official website.

BP first became involved in Azerbaijan in 1994, when it helped develop the Azeri, Chirag and Deepwater Gunashli (ACG) fields. Production from those fields kicked off in 1997, and since then over 3.3 billion barrels of oil have been pumped from the reservoir. In 2017, SOCAR and partners involved in ACG signed an amended production sharing agreement to extend the fields’ exploration until the end of 2049.

In 1996, BP signed a second agreement, to develop Azerbaijan’s largest offshore gas condensate field known as Shah Deniz. The field is considered BP’s largest discovery after the Prudhoe Bay oil field in Alaska. Shah Deniz contains one trillion cubic meters of gas, nearly a third of Azerbaijan’s overall estimated reserves.

Shah Deniz is the sole supply for the Southern Gas Corridor, which will feed 10 billion cubic meters of gas to Europe via a 3,500 km overland and underwater mega-pipeline that will traverse six countries. The pipeline will also deliver an additional six billion cubic meters of gas to Turkey, and go online sometime later this year.

BP has two additional production sharing agreements with Azerbaijan. An agreement signed in 2010 was for development of the Shafag-Asiman offshore block, and another, signed in 2014, was for the shallow water area around the Absheron Peninsula, which includes Baku.