Minister: Azerbaijan’s task - to maintain stable oil production

Thu 19 Sep 2019 11:15 GMT | 15:15 Local Time

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According to forecasts, by 2021, oil production in Azerbaijan will reach approximately 39 million tons per year, Azerbaijan’s Energy Minister Parviz Shahbazov said at a press conference at the headquarters of the ruling New Azerbaijan Party, Trend reports Sept. 19.

He said that forecasts for this year are 38.7 million tons, and in 2020, production will increase slightly.

“In 2020-2021, oil production will be stable, at the level of 39 million tons,” the minister said, adding that maintaining a stable level of oil production is the main task.

The major part of Azerbaijan’s oil is produced at the Azeri-Chirag-Gunashli (ACG) block of oil and gas fields, which Azerbaijan is developing together with an international consortium led by BP.

A production sharing agreement (PSA) dubbed “the Contract of the Century” was signed between Azerbaijan’s state oil company SOCAR and a consortium of 11 foreign oil companies from six countries for a period of 30 years.

Following ratification of the PSA, the Azerbaijan International Operating Company (AIOC) was formed to implement the agreement on behalf of the foreign shareholders working in partnership with SOCAR and the government of Azerbaijan.

Initially, the company included 11 major foreign oil companies (BP, Amoco, Unocal, LUKoil, Statoil, Exxon, TPAO, Pennzoil, McDermott, Ramco, Delta Nimir), representing six countries - the UK, the US, Russia, Norway, Turkey and Saudi Arabia.

In 2017, the agreement was extended until the middle of this century.

The current participating interests of ACG are as follows: BP (30.37 percent), SOCAR (25.0 percent), Chevron (9.57 percent), INPEX (9.31 percent), Equinor (7.27 percent), ExxonMobil (6.79 percent), TPAO (5.73 percent), ITOCHU (3.65 percent), ONGC Videsh Limited (OVL) (2.31 percent).

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