BAKU, Azerbaijan, Jan. 6
By Fidan Babayeva – Trend:
Revenues of Azerbaijan’s State Oil Fund (SOFAZ) from payments on contract areas by foreign investors in connection with the development of hydrocarbon reserves will make up over 4.1 million manat ($2.4 million), the Accounts Chamber stated in its opinion for the fund’s 2021 draft budget, Trend reports.
According to the chamber, this year, it’s envisioned to receive over $2.1 million in accordance with the agreement on the exploration, development and distribution of the production share of the Shafag-Asiman offshore block of fields in the Azerbaijani sector of the Caspian Sea.
“The payment should be made under article 28 of the agreement between SOFAZ, BP Exploration Company Limited (Azerbaijan) and SOCAR oil affiliate on the exploration, development and distribution of the production share of the Shafag-Asiman offshore block of fields,” the chamber noted. “During the main, as well as the additional exploration period, other contracting parties shall pay $2,000 for each square kilometer of the contract area.”
At the same time, payment regarding the contract area in the amount of $642,000 is envisaged according to the agreement on exploration, development and distribution of the production share in the shallow water area around the Absheron Peninsula in the Azerbaijani sector of the Caspian Sea.
However, since the main exploration period expires in 2021, and the beginning of the exploration period is November 2017, the payment to be made in 2021 will make up $321,000.
SOCAR and BP signed a contract on the Shafag-Asiman block for a period of 30 years in October 2010. At the first stage, it’s planned to drill two wells. If necessary, in the second stage, two more wells can be drilled. With the transition to the operational period, the parties will jointly operate the project. Share participation in the contract is 50 to 50.
The forecast reserves of the Shafag-Asiman block stand at 500 billion cubic meters of gas and 65 million tons of condensate.
The block lies some 125 kilometers (78 miles) to the South-East of Baku. It has never been explored before. It is located in a deepwater section of about 650-800 meters with reservoir depth of about 7,000 meters.
(1 USD = 1.7 AZN on Jan.6)
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