BAKU, Azerbaijan, November 20. Strategic documents on the natural gas supply were signed between Azerbaijan and Serbia last week, Trend reports.
Thus, a Memorandum of Understanding (MoU) outlining cooperation development between the State Oil Company of Azerbaijan (SOCAR) and Srbijagas, the state-owned natural gas provider in Serbia, was signed, along with an agreement for gas sales.
Furthermore, the MoU extends beyond gas supplies to include the possibility of supplying LNG to Serbia. It also comprises working with SOCAR on gas storage facilities, investigating participation in the company's gas trading operations, and building natural gas-fired power plants.
The agreed contract calls for up to 400 million cubic meters of gas to be transported over the next year. Furthermore, this volume is likely to rise in the next years.
Azerbaijan and WindEurope also explored opportunities for in-country production of wind energy systems last week.
In addition, during the reporting week, SOCAR President Rovshan Najaf and Venezuelan Ambassador to Azerbaijan Christopher Alberto Martinez Berroteran addressed the prospects for increasing energy cooperation.
The dialogue also spotlighted collaboration prospects between SOCAR and Venezuelan enterprises in the oil and gas sectors, emphasizing knowledge exchange in hydrocarbon resource development, decarbonization efforts, and personnel training.
Meanwhile, Azerbaijan, Kazakhstan, and Uzbekistan have discussed the possibilities of electricity transit from Central Asian countries.
The Ministry of Economy of Azerbaijan noted that the parties have reached an agreement on the preparation of a feasibility study of the project and the creation of a joint venture for the export of electricity.
Moreover, bp Vice President for the Caspian region, Communications and External Affairs Bakhtiyar Aslanbayli said last week that bp is currently in preparation for commencing the drilling of the first production well from the Azeri Central East (ACE) platform at the Azeri-Chirag-Gunashli (ACG) block in November, and this will allow to deliver the first ACE oil as planned in early 2024.
"In March this year, we sailed away the ACE jacket and installed it at its permanent location in the Azeri-Chirag-Gunashli field. This was followed by the departure of the ACE topside unit in August. We have already completed topside unit offshore hookup, installation, and commissioning works, and the project has currently reached a 94 percent progress milestone," he said.
Aslanbayli noted that the well was spudded on February 7, 2023, aiming to acquire data about the deep-lying gas reservoirs beneath the currently producing oil field.
"We completed the drilling activities in April. We are currently studying the data obtained from the well and are working to understand the potential of the deep gas layers of ACG," he explained.
bp vice president also noted that currently, the drilling activities on the exploration well SDX-8 are progressing safely and steadily.
"The exploration well SDX-8, which we are drilling in the Shah Deniz contract area, was spudded on January 20, 2023. The well being drilled with the Heydar Aliyev semi-submersible rig is located on the eastern flank of the Shah Deniz field. It aims to evaluate the deeper reservoirs beneath the existing Shah Deniz-producing layers. We plan to drill the well to a total depth of around 7,000 meters," he said.
Aslanbayli mentioned that the Shah Deniz 2 project is currently progressing on schedule towards the production start-up from the East North flank in the fourth quarter of the year.
"The installation and testing activities for this start-up project continue both subsea and on the topside modules onboard the Shah Deniz Bravo platform. The project has successfully completed the East North flank commissioning vessel support activities and is currently progressing with the platform commissioning scope towards the system handover," he explained.
Speaking about the Sunrise ("Shafag") project, he noted that this is a 240-megawatt solar plant project to be built in Jabrayil.
"But it is not a typical solar project, as it is expected to be linked to another project that will support the decarbonization of our operations. This is expected to be achieved by a pilot commercial structure of a virtual power transfer arrangement—an approach agreed with the Ministry of Energy that will allow us to offtake the electricity generated in Jabrayil to run our current operations through a virtual power transfer," said bp's vice president.
He stressed that bp is currently working with the government, SOCAR, and other partners to finalize the outstanding technical and commercial issues related to the project.
"In 2023, we conducted field surveys for constructing the solar plant in Jabrayil, and we also signed an accession agreement with SOCAR and the Azerbaijan Investment Company (AIC) on the Shafag (Sunrise) project. The document specifies SOCAR’s and AIC’s intention to enter the project. This shows that the project is steadily progressing towards its final investment decision," added Aslanbayli.
Regarding the newly established 'Shafaq (Jabrayil) Solar Limited' company, he said that this is a legal entity formed to own and manage the Sunrise project.
Furthermore, last week, OPEC revised its forecast for Azerbaijan's liquids output in 2023 and 2024.
The projected liquids supply for Azerbaijan in 2023 is expected to decrease by approximately 20,000 b/d, averaging 0.7 mb/d.
OPEC revised down its forecast slightly by 8,000 b/d, mainly due to lower-than-expected production in major oil fields, particularly in September.
The International Energy Agency (IEA) adjusted its projection for Azerbaijan's oil production in 2024.
Azerbaijan's oil production in 2024 is expected to stand at 0.65 mb/d.
The forecast has been marginally adjusted downward by 0.1 mb/d, in contrast to the assessment from the previous month.
Consequently, the anticipated oil output for the country is projected to be 0.64 mb/d in both the first and second quarters of 2024.
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