Autumn 1996 (4.3) Page 34 SOCAR Foreign Investment What's Happening (Autumn 1996) by Natig Aliyev, President of SOCAR It was approximately 140 years ago that commercial oil production began in Azerbaijan and by 1911, Baku was producing 50% of the world's production. At the beginning of this century, our oil producers successfully competed in the world market with European and North American oil companies. At the same time, foreign investors greatly assisted Azerbaijan in developing oil reservoirs, refinery, machinery and transport communication. These days we have 50 fields which are currently productive, 14 of which are located offshore in the Azerbaijan sector of the Caspian. In addition, 145 prospective structures have been discovered by geophysical survey. Forty of these are in water depths up to 60 meters, 33 are in deeper depths (60 to 200 meters), and the remaining 72 are in deep water of more than 200 meters. Recoverable reserves are estimated at 3.5 million tons of crude oil and more than 600 billion cubic meters of gas. On September 20, 1994, what has become known as "The Contract of the Century" was signed for the joint development and production sharing for the Azeri, Chirag, and deep-water Gunashli fields in the Caspian. Now there are eleven companies representing seven countries which make up the Consortium of the AIOC (Azerbaijan International Operating Company). This document has been extremely significant not only for our Republic but also for neighboring states. In addition, it has resulted in attracting some of the world's largest companies to Azerbaijan including Shell, Chevron, Mobil, Elf Aquitaine, Occidental, Arco, Total and Agip. Recently various joint ventures have been formed between Azerbaijan and foreign companies to facilitate AIOC's operations. SOCAR Joint Ventures Azfen (Tekfen-Turkey). To enable Azerbaijani local enterprises to be involved with AIOC operations. They have since won two AIOC tenders, for the construction and electric mechanical work on the Sangachal Terminal which will be used for storing early oil from Chirag 1. Caspian Drilling Company (Sante Fe-US). Involved with drilling operations. Caspian Geophysical (Western Atlas-US). To conduct seismic surveys in the Caspian. Caspian Logistics Services (Consolidated Supply Management-Scotland). To provide procurement and warehouse services. Fluor Daniel (US) with both the AIOC and SOCAR sent a technical team to conduct feasibility studies of the existing pipeline systems to determine the suitability of, any refurbishment required for utilizing these systems for the production of Early Oil, scope of work, evaluation, timing profitability including site investigation survey and testing. MacDock (McDermott-US). To carry out material refurbishment of vessels owned by the Caspian Shipping company. MacPipe (McDermott-US; Kvaerner-Norway). To construct subsea pipelines. MacShelf (McDermott-US). To produce deepwater drilling platforms at the fabrication yard known as Shelfprojectstroy [usually known by its abbreviated form, "SPS"]. Stolt Comex Seaway and Comex Pro (French companies). To provide diving services. New Blocks Under Negotiations Negotiations are currently being carried out with the following companies: Mobil (US) for Taghiyev · Exxon (US) for Blocks D-3, D-9, and D-38 · Chevron (US) for Blocks 1 and 2 · Occidental (US) for Hammamdagh Sabail on the Baku archipelago. Arco, Conoco, Ramco, Japanese National Oil Corporation (JNOC) and various other companies are involved in discussions as well. From Azerbaijan International (4.3) Autumn 1996. © Azerbaijan International 1996. All rights reserved. Back to Index AI 4.3 (Autumn 1996) AI Home | Magazine Choice | Topics | Store | Contact us