Azerbaijan to receive new Chinese oil production equipment

Oil&Gas Materials 19 February 2018 13:58 (UTC +04:00)

Baku, Azerbaijan, Feb.19

By Leman Zeynalova – Trend:

New Chinese oil production equipment for operation at Azerbaijan’s largest block of oil fields Muradkhanli-Jafarli-Zardab will arrive in the country on March 16, 2018, Canada’s Zenith Energy company, the project operator, said.

Zenith's A-80 workover rig, inherited from Azerbaijan’s state oil company SOCAR, has recently undergone further upgrades to increase its capabilities and enable it to be utilized more extensively in the company's workover operations, according to a message from Zenith.

“The company is in the process of fitting hydraulic tongs to increase the pulling efficiency and speed of the rig, a new rig floor, and installing other ancillary equipment. The aforementioned upgrades are in addition to the comprehensive modernization Zenith's A-80 rig underwent in 2017 when field rehabilitation began in Azerbaijan,” said the company.

Zenith Energy received delivery of the first consignment of oil production equipment from China in late December 2017. The order of the equipment was announced by Zenith on August 21, 2017. The equipment quickly cleared customs and is now being deployed in the field.

“Zenith has been advised that the second and final consignment of Chinese oil production equipment will arrive on March 16, 2018. The shipment will include the company's new set of blow-out preventers and drill pipe, as well as ancillary workover equipment,” said the message.

As was announced on January 25, 2018, the company has signed a purchase agreement for an A-100 truck-mounted workover rig. This was purchased using the funds raised from Zenith's UK placing announced on January 24, 2018.

“The factory where the A-100 rig is under construction is located approximately 2 hours from the company's field locations, enabling Zenith's operational team to inspect progress twice a week. Delivery of the rig is expected in late April 2018,” said Zenith Energy.

Azerbaijan’s state oil company SOCAR and Zenith Aran Oil Company signed a Rehabilitation, Exploration, Development and Production Sharing Agreement (REDPSA) in March 2016 for a block that includes the Muradkhanli, Jafarli and Zardab oilfields. These fields cover an area of 642.2 square kilometers. Production under the agreement began in August of 2016.

Zenith holds a 80-percent participating interest in the three fields within the contract area, while SOCAR retains the remaining 20 percent. The duration of the agreement is 25 years, with a potential extension of five additional years.


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