News Archive

16 January 2020

Drilling, production and export figures for 2019

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• Last year SOCAR maintained stable oil and gas production

• Natural gas production increased by 17% amid natural decline in oil production in the country • Natural gas consumption in the country increased by almost 9% mainly due to the development of gas chemical industry and widening the household gas supply infrastructure

• Azerbaijan increased natural gas export by 23%; 2.8 billion cubic meters of gas were transported by the Southern Gas Corridor

• Export of refined and petrochemical products grew by 22% amid SOCAR’s new petrol- and gas chemical facilities

In 2019, SOCAR managed to stabilze and increase the oil and gas production in the fields, operated by own means and produced on its own accord 7.7 million tons1 of oil and 6.8 billion cubic meters2 of natural gas.

Total gas production in the country increased by 17% compared to the previous year and reached 35.6 billion cubic meters3 . During the year, 37.5 million tons4 of crude oil were produced in the country. Although SOCAR has managed to stabilize production level in the fields directly operated by itself, there was a steady decline in the country’s oil production, including the production rates of other operators. The natural decline has been observed since 2010 in the Azeri-Chirag-Deepwater Gunashli fields operated by the international consortium.

During the reporting period, a total of 291,000 meters5 of drilling work was conducted in the country, including 151,000 meters6 by SOCAR. In 2019, as part of a joint project of SOCAR and Total, the deepest well in Azerbaijan with 7411-meter depth was drilled at the Absheron field supported by Heydar Aliyev Submersible Drilling Rig. The development of Absheron field is one of the important projects to increase gas production in the future. The field’s first production is scheduled for 2021 and gas volumes produced there are considered primarily for the domestic market.

Gross domestic consumption of natural gas in the country, excluding technical and transportation costs and losses, was 11.5 billion cubic meters7. Compared to the relevant figures of 20188, domestic gas consumption increased nearly by 918 million cubic meters or 8,7% due to the growth of gas chemical industry, particularly operation of SOCAR’s urea and methanol plants which use natural gas as a raw material. The household gas consumption also increased by 8.5% as a result of expanding the natural gas infrastructure in the country.

Last year, Azerbaijan increased its natural gas export by 23% levelling it up to 11.6 billion cubic meters9. SOCAR is supplying most part of natural gas it produced to meet domestic demands, but growth in exports came from the rise of production level at Shah Deniz gas-condensate field operated by the international consortium. The natural gas was exported to Turkey and Georgia last year. In total, Turkish market received 9.2 billion cubic meters10 of gas, including 2.8 billion cubic meters11 transported by the Southern Gas Corridor and TANAP. Turkish market’s share in the Azerbaijani gas export was 79%.

During the year, SOCAR exported nearly 21.1 million tons of crude oil. It should be noted that in addition to oil produced by SOCAR on its own accord, the company also exports SOCAR’s and Azerbaijan’s profit share in oil, produced by the consortium of international companies operating in the country.

The export of oil refining products and petrochemicals amounted to 2.2 million tons12 in 2019, increasing by 22% compared to the previous year, due to the operation of SOCAR’s urea plant and SOCAR Polymer complex, as well as production growth at the SOCAR’s methanol plant, among other factors.



1-7,683,153 tons

2- 6,818,640,000 cubic meters

3- 35,616,510,185 cubic meters

4- 37,453,702 tons

5- 291,490 meters

6- 150,848 meters

7-11,531,590,000 cubic meters

8- Gross domestic consumption in the country was 10.613.246.000 cubic meters in 2018, exluding technical expense and losses.

9 -11,586,368,000 cubic meters

10- 9,180,179,000 cubic meters

11 -2,783,692,000 cubic meters

12 -2,233,210 tons

15 January 2020

First Shafag-Asiman exploration well spudded offshore Azerbaijan

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SOCAR and BP announced today that the first exploration well was spudded on the Shafag-Asiman offshore block in the Azerbaijan sector of the Caspian Sea on 13 January. SOCAR and BP each hold 50% equity interest. BP is operator during the exploration phase of the project. Drilling is conducted by SOCAR’s Caspian Drilling Company. The SAX01 well is the first to be drilled in the contract area and is in accordance with the PSA that was ratified by the Azerbaijani parliament in 2011.

The well is planned to reach total depth of up to 7000 metres, which is expected to take around nine months, and following this, well data will be analysed and, if successful, an evaluation programme may be conducted to confirm the results.

Rovnag Abdullayev, president of SOCAR, said: “A while back, we have successfully completed seismic study in the Shafag-Asiman block with our partner BP. Now we are embarking on the next step, and starting to drill an exploration well. The exploration drilling will allow to fully uncover the block’s potential. We are proud that today Azerbaijani companies -SOCAR’s business units provide all key services, including the construction of platforms and jackets as well as drilling, for such complex projects, as Shah Deniz, Azeri-Chirag- Gunashli and Shafag-Asiman. We consider this as one of the most important achievements of Azerbaijani oil workers during the era of national independence.”

Gary Jones, BP’s Regional President for Azerbaijan, Georgia and Turkey, said: “We are excited and proud to be embarking on this first exploration well on the Shafag-Asiman offshore block structure which has great potential and which, if successful, could be a gas discovery of significant scale. A great deal of preparation has been made to assure a safe and robust drilling programme, delivered by an expert and motivated team using a drilling rig with managed pressure drilling capability.”

The well is being drilled from the Heydar Aliyev semi-submersible rig operated by the SOCAR’s Caspian Drilling Company (CDC). The rig was contracted for the SAX01 well in November 2019 and then moved to the well location in preparation for the commencement of drilling operations.



Notes to Editors

• The Shafag-Asiman PSA between SOCAR and BP on joint exploration and development of the Shafag-Asiman offshore block in the Azerbaijan sector of the Caspian Sea was signed in Baku in October 2010.

• The block lies some 125 kilometres (78 miles) to the South-East of Baku. It covers an area of some 1,100 square kilometres. It is located in water depths of 650-800 metres.

• The block is 60km from Shah Deniz and 145km from the Sangachal terminal.

• 3D seismic acquisition programme was conducted on the contract area in 2012.

• Interpretation of the seismic dataset was completed in 2015 followed by the selection of the first well location and planning for drilling activities.



Further information:

Ibrahim Ahmadov at SOCAR’s Public Relations and Events Management Office

Telefon: (+99412) 521 03 69



and

Tamam Bayatly at BP’s Press Office in Baku.

Telephone: (+994 12) 525 58 95