SOCAR to follow commercial profit with increasing interest in ACG
Azerbaijan, Baku, June 9 / Trend E. Ismayilov /
The purchase of a 1.6 percent stake in the Azeri-Chirag-Guneshli project may require additions to the main contract, signed in 1994, a senior representative of the State Oil Company of the Azerbaijan Republic (SOCAR) told Trend.
SOCAR intends to acquire half of a 3.29 percent stake of Devon from British BP, which was formerly involved in the project and sold its assets in Azerbaijan.
The source said the contract reflects sale of SOCAR's shares in the project, but did not reflect the other participants' possible acquisition of shares.
Work has been carried out to this end to prepare changes to existing contracts. In this way, project partners were also able to pursue joint legal agreements.
Preparation of the amendments is nearly complete and may be presented to parliament for approval, the source said.
Parliament is to adopt amendments to the contract given that, in practice, all contracts for PSA in Azerbaijan should be ratified by Parliament and have the force of law.
Additions to the contract might be completed within the month, after which the sale-purchase contract will be signed. This project is very profitable and the company has approached this issue from the standpoint of commercial benefits.
Devon sold its 5.63 percent share in Azeri-Chirag-Guneshli in 2010 to its project partners - BP (3.29 percent), Chevron (0.99 percent), Inpex (0.96 percent) and Itocu (0.38 percent).
Currently, the participation share of BP (operator) in Azeri-Chirag-Guneshli is 37.43 percent, Chevron - 11.27 percent, Inpex - 10.96 percent, AzACG - 10 percent, Statoil - 8.56 percent, Exxon - 8 percent, TPAO - 6.75 percent, Itocu - 4.3 percent and Hess - 2.72 percent.
In 2010, Azeri-Chirag-Guneshli produced 40.6 million tons of oil compared to over 40.3 million tons in 2009. Production of oil from this block in 2010 averaged 823,100 barrels per day.