BP starts production offshore Azerbaijan

BP started production in another section of one of Azerbaijan's largest offshore oil fields, Azeri-Chirag-Gunashli field in the Caspian.

Offshore staff

(Caspian Sea) - BP started production in another section of one of Azerbaijan's largest offshore oil fields, Azeri-Chirag-Gunashli (ACG) field in the Caspian.

Oil from one of three wells at the West Azeri platform reached the Sangachal oil terminal, about 40 km south of the Azeri capital, Baku, on January 4.

BP is operator for the Azerbaijan International Operating Co. (AIOC) the 10-member consortium of licensees, which is developing ACG.

The terminal is the starting point for a 1,760 km US-backed pipeline that runs through Georgia to the Turkish Mediterranean port of Ceyhan and will bring Caspian Sea oil to Western markets.

David Woodward, who is overseeing BP's operations in Azerbaijan, said the startup of the West Azeri field, located about 100 km east of Baku, came four months ahead of schedule.

Total output from West Azeri is estimated to be around 70,000 b/d day in 2006.

West and East Azeri comprise phase II of the ACG project. This phase will represent more than 420,000 b/d when East Azeri comes onstream next year.

Early oil production from Chirag began in late 1997. Central Azeri, which is phase I of the ACG project, came onstream in February 2005, and produced around 93,000 b/d in 2005. An average output of 230,000 b/d is expected in 2006.

The third phase covers the deepwater Gunashli field, which is due to begin production during 2008. This will bring the total ACG development to seven platforms.

Total output from ACG will be more than 1 MMbbl/d by 2009.

It is estimated that 5.4 Bbbl of oil and 100 bcm of natural gas will be recovered within the duration of the production sharing agreement.

The entire Caspian Sea is believed to contain the world's third largest reserves of oil and gas.

Other companies in the consortium include ExxonMobil Corp., Unocal, Norway's Statoil ASA (STO) and Azerbaijan's state oil company Socar.

1/6/06


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