Oil & gas news

EXPLORATORY WELL TO BE DRILLED ON OGUZ

The Oguz Operating Company intends to embark on exploratory drilling on Oguz prospect in late March. Only one exploration well will be drilled on the prospect, says the Oguz Operating Company spokesman Boris Zuvkov.

Total depth of the well will be 3,580 meters with water depth of 66 meters. Mr. Zuvkov added that drilling would be carried out using the "Gurtulush" drilling rig and take 52-56 days to complete.

DEVON ENERGY INCREASES STAKE IN OIL-FIELD

Devon Energy Corporation announced last Wednesday that it has increased its ownership in the Azeri-Chirag-Gunashli oil fields ("ACG") in the Caspian Sea, offshore Azerbaijan. Devon has acquired an additional 0.8% interest in ACG from Ramco Energy plc for a purchase price of $58.3 million.

The acquisition increases Devon's interest in ACG from 4.8% to 5.6%. Proved reserves as of December 31, 2000 associated with the additional 0.8% interest were 17.5 million barrels of oil equivalent. These reserves were not included in Devon's December 31, 2000 estimates of proved reserves.

CONOCO OPENS OFFICE IN BAKU

US Conoco-Energy opened its offices in Baku last Wednesday. Manager of the company Yuri Liasch indicated in the ceremony that Azerbaijan is the 40th country in the world for Conoco to run an office.

President of Conoco-Eurasia Martin Lockley said Conoco had been taking interest in Azerbaijan since 1996. At the present time, Conoco is involved only in one project, Zafar-Mashal, but he did not rule out the possibility of joining other deals.

SOCAR holds a 50% interest in the Zafar-Mashal contract, 30% is held by ExxonMobil and 20% by Conoco.

EXXONMOBIL INVESTS OVER $700 MLN

US ExxonMobil has invested over $700 million in Azerbaijan. According to the company's representative Joe Carlos, the investment has mainly been made in the Azeri-Chirag-Gunashli, Oguz, Nakhchivan, and Zafar-Mashal projects.

The company has already started producing oil from Azeri-Chirag-Gunashli, intends to embark on exploratory drilling on Oguz, has completed 3D seismic survey on Nakhchivan, and is still engaged in seismic survey on Zafar-Mashal, he said.

ExxonMobil has allotted over $2 million for various social programs. According to Mr. Carlos, 80% of the company's Baku staff are national personnel.

SHAH-DANIZ PARTNERS APPROVE EXPLORATION EXPENSES

Wednesday's meeting of the "Shah-Daniz" partners decided to complete the exploration operations on the field. BP, project operator, told Azernews Thursday that the partners had also approved the commercial cost of research and exploration work on the field.

The partners decided to report to SOCAR in writing next week concerning the exploration operations and their cost.

BP also announced commencement of a new stage of operations, thus dismissing reports suggesting that the work had been allegedly suspended pending the outcome of talks with Turkey.

FEBRUARY OIL PRODUCTION PLAN FULFILLED, UNLIKE GAS

In February 2001, 692,900 tons of oil were produced instead of the planned 682,500 (101.5%). The plan has been over-fulfilled off and onshore. Offshore, 574,500 tons were produced (101.1%) and onshore 118,400 tons (103.8%).

The February gas production plan has been considerably under-fulfilled - almost by 9%. With the plan of 448,100,000 cubic meters 407,400,000 were produced (90.9%). 340,400,000 cubic meters were extracted offshore (96.2%) and 19,700,000 cubic meters onshore (105.9%).

The AIOC produced 47,300,000 cubic meters of gas (62.6%).

SOCAR FULFILLS 2-MONTH PLAN

In the first two months of the year, instead of the planned 1,438,200 tons of oil 1,460,100 tons were produced (101.5%). As compared to 2000, this is 0.6% less. Two-month offshore plan has been over-fulfilled with 1,212,000 tons of oil produced (101.2%). Onshore 248,100 tons were produced (103.2%).

Gas production in January-February made up 869,000,000 cubic meters (92.1%), of which 722,300,000 cubic meters were produced offshore (96.9%) and 40,900,000 cubic meters onshore (104.6%).

The AIOC produced 105,800,000 cubic meters of gas (66.4%).

2-MONTH OFFSHORE DRILLING PLAN FULFILLED

In January-February 2001, SOCAR drilled 21,975 meters, or 97.5% of the plan and 99.4% of last year's.

13,543 meters were drilled offshore (110.7%) and 8,432 meters (81.8%) onshore.

The best performance (121.1%) was reached in exploratory drilling, with 1,272 meters drilled. Both off and onshore, the plan has been over-fulfilled by 2 and 46.7% respectively.

Production drilling constituted 20,703 meters (96.4%) thanks to excellent performance by offshore workers - 12,931 meters (111.2%). 7,772 meters were drilled onshore (78.9%).

CONOCO PLANNING ON SHAH-DANIZ GAS

President of Conoco Eurasia Mr. Martin Lockley thinks the gas to be produced from Shah-Daniz field will positively affect the work of the liquefied gas terminal in Batumi.

According to him, a very small quantity of Kazakh and Turkmen gas is being exported from the terminal and the Shah-Daniz gas will enable a full workload of the facility.

Under the protocol signed between SOCAR and Conoco in 1997, the company is to study the gas industry development program and the investment volume necessary. Based on the results of the survey, Mr. Lockley concluded that there are good opportunities in Azerbaijan for gas industry development.

CASPIAN HYDROCARBONS

The Ukrainian delegation met with SOCAR president Natiq Aliyev Thursday.

The SOCAR head spoke of Azerbaijan's oil strategy, its implementation, oil sector milestones, contracts signed, transportation of hydrocarbons to world markets and upcoming privatization of the oil industry infrastructure. He then outlined development prospects of the oil industry.

The Ukrainian delegation took an interest in economic development of Ukraine and Azerbaijan on mutually beneficial terms. It was indicated that Ukraine could grow from a consumer of Caspian energy into a country transporting them to European markets.

The parties also considered some proposals of the Ukrainian party, a SOCAR source told Azernews Thursday.

Azernews

AssA-Irada