Starting construction of second floating drilling rig in Azerbaijan announced

Oil&Gas Materials 23 January 2014 17:34 (UTC +04:00)
Construction of the second new generation drilling rig in Azerbaijan may start in the third quarter of 2014

Baku, Azerbaijan, Jan. 23

By Emin Ismayilov - Trend:

Construction of the second new generation drilling rig in Azerbaijan may start in the third quarter of 2014, the source in the oil and gas market of the country told Trend on Jan. 22.
According to the source, the technical discussions within the construction of the second rig have been completed, and now the process is at a stage of commercial negotiations (identifying sources of funding).

At present, there are three large drilling rigs in Azerbaijan (the Heydar Aliyev rig, the Istiqlal rig and the Dada Gorgud rig), which are involved in the development of Azeri-Chirag-Guneshli block of oil and gas fields and Shah Deniz gas condensate field.

Moreover, a floating drilling rig of the new generation, to be used by SOCAR in field and prospective structure mining in the Caspian Sea, is being constructed in the country.
Accordingly, a new drilling rig is required for the development of the Absheron field. Participants of the Absheron project comprise SOCAR - 40 percent, French companies Total - 40 percent and Gaz De France Suez - 20 percent.

"The negotiations between the Caspian Drilling Company (CDC, which may become an operator of the rig), Total and other partners continue successfully. To date, the process is at the stage of commercial negotiations," the source said.

The source went on to say that successful negotiations and final agreement will enable starting construction of the new rig in September 2014. He added that there is a possibility for simultaneous construction in Azerbaijan of two new rigs.

The source pointed out that construction of the first rig continues according to schedule, and it will be ready for use until the end of 2016. CDC will be an operator of the first rig as well. 92.44 percent of the equity is held by SOCAR.

A drilling rig will be required in 2017 to get the first gas from the Absheron gas condensate field in the Azerbaijani sector of the Caspian Sea. Gas production within the indicated period will require the necessary drilling operations, as well as creating all necessary mining infrastructure. The main issue in the Absheron field development is the free floating drilling rig.

Following the drilling of an exploration well, discovery of Absheron large natural gas field in the Azerbaijani sector of the Caspian was announced in September 2011.
The field potential reserves amount to 350 billion cubic meters of gas and 45 million tons of condensate.

The contract on the field was signed on February 27, 2009 between SOCAR and Total. Later Total sold 20 percent equity participation to Gaz De France Suez.

Translated by M.L.

Edited by C.N.