Total eyes lower capex for Azerbaijan’s Absheron field project

Oil&Gas Materials 29 November 2018 16:00 (UTC +04:00)

Baku, Azerbaijan, Nov.29

By Leman Zeynalova – Trend:

A scheme with low capital expenditure needed for the development of Azerbaijan’s Absheron gas field, said Denis Lemarchal, Total country chair in Azerbaijan and managing director of Total E&P Absheron.

“We need to plan the second phase, and it will be determined by several conditions. First, there are technical conditions, as we need to fine-tune our knowledge of the reservoir, and that will begin with the results of the first well. As you know, there is a lot of competition in the gas market, so we need to have a scheme with low capex. We have to identify and refine our development scheme to limit capex, which means that we must optimize the use of existing facilities,” he told TOGY.

Lemarchal noted that it is also necessary to assess the needs of the market.

“We need a gas buyer. It will probably be a mix of domestic consumption and exports, but we have to do the study for that. There are still some opportunities in the domestic market, and as for exports, there are a lot of potential buyers along the Southern Gas Corridor, including ones in Turkey and Europe,” he noted.

Lemarchal pointed out that production for Absheron is slated for 2020, so for 2019, the main target is to implement, together with SOCAR, the EPS.

“As for future projects, Total is a large company and we of course wish to have more activity in Azerbaijan, not limited to the Absheron development. We are looking for additional opportunities,” he added.

Azerbaijan’s state oil company SOCAR and Total signed a framework agreement in 2016 on the main contractual and commercial principles regulating the program of the first phase development of the Absheron field.

The first phase of the field’s development envisages drilling of one well at a sea depth of 450 meters. The production will stand at 1.5 billion cubic meters of gas and 700,000 tons of condensate per year and these volumes will be used in Azerbaijan’s domestic market. It is planned to produce up to 4 billion cubic meters of gas at the second stage.

Absheron’s reserves are estimated at 326 billion cubic meters of gas and 108 million tons of condensate, according to the estimations of Total specialists.

JOCAP, is a joint venture with 50 percent ownership by SOCAR and the remaining 50 percent - by Total, the operator of the development of the Absheron field.


Follow the author on Twitter: @Lyaman_Zeyn