SOCAR & Gazprom Germania negotiate under major agreement

Oil&Gas Materials 12 October 2009 18:06 (UTC +04:00)

Azerbaijan, Baku, Oct. 12 / Trend E.Ismayilov /

SOCAR (State Oil Company of Azerbaijan) and Gazprom Germania ZMB GmbH will sign an agreement on services "in assisting in the implementation of the project on utilization of low pressure associated gas in the areas of the Oil Rocks Oil and Gas Unit after coordination of the commercial cost of the contract , SOCAR Vice-president Mukhtar Babayev said.

Babayev said that the German side started preparing their proposals for the possible reconstruction of these facilities.

"The agreement is not a subject yet. There are some technical issues that can satisfy both sides, but there is a second, commercial, financial part. It is not over yet. As soon as it is finished and if it is positive for both sides, of course, then the contract will be signed," Babayev said.

"At present, negotiations are underway and the exact date of signing the agreement has not yet been determined," Babayev said.

Under this project, Gazprom Germania will provide technical assistance and perform validation (verification). This project involves the collection of associated gas at the sites of the Oil Rocks and Muddy Volcano fields.

In summer the two companies has discussed and considered this agreement. Discussions were held during the Baku visit of Gazprom Germania' experts, David Graebe and Eric Vaigelt. The possibility of continuing the project under the clean development mechanism is assessed during the visit, SOCAR Ecology Department said earlier.

SOCAR submitted this project proposal to the German company in early 2008. SOCAR and Gazprom Germania signed confidentiality agreement.

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