Bob Dudley, the new chief executive of UK oil giant BP, has signed a deal to develop a major natural gas field in Azerbaijan.
The agreement is to develop the deepwater Shafaq-Asiman field, which lies 125 kilometres south-east of Baku. The deal was signed by Rovnag Abdullayev, president of Azerbaijan’s national oil company SOCAR, and Rashid Javanshir, president of BP Azerbaijan.
The gas field has estimated reserves of 17,000 billion cubic feet, similar to the Shah Deniz gas field (also in Azerbaijan), in which BP has a 25.5 per cent stake.
The previously unexplored field, which covers an area of around 1,100 square kilometres, is sited in deepwater at about 650 metres to 800 metres, with reservoir depth of about 7,000 metres.
Commenting on the deal, Dudley said: “This is an important day for Azerbaijan and BP as it marks the beginning of our bilateral cooperation in exploration and development of a new offshore block. With SOCAR and our partners BP has helped to establish Azerbaijan as a world scale oil and gas producer, and I believe the significant remaining potential will continue to make it relevant for decades to come.
“We in BP very much hope that the combination of our leading technology and expertise with Azerbaijan’s experience and potential will lead to new discoveries in the Caspian,” he added.
The deal is structured as a 50/50 production-sharing agreement over a period of 30 years.
Azerbaijan is seen as an important area by BP, which is the largest producer in the country and one of the largest investors. The company is operator of the huge Azeri-Chirag-Gunashli oil field in the Caspian, and of the Baku-Tbilisi-Ceyhan pipeline, which carries Azeri oil to Turkey's Mediterranean coast.
The deal is Dudley’s first major move since he took over from Tony Hayward at the beginning of the month, almost six months since the Deepwater Horizon spill in the Gulf of Mexico.
