Baku News

05 June 2008 - Finmarket - The State Oil Company of Azerbaijan and French Total signed an agreement on basic commercial principles of the production sharing agreement on the Absheron structure development, Interfax reports with reference to SOCAR. Total's share in the contract is proposed to make 60% and SOCAR's 40%. SOCAR intends to sign a production sharing agreement on Absheron structure development, which will lay a legal basis for its development. By estimates of the SOCAR specialists, the proven reserves of the Absheron structure make 300 bln cubic meters of gas and 45 mln tons of condensate. The memorandum between SOCAR and French Total on the Absheron structure was signed in early February of 2007. A contract on the Absheron structure development, which involved Chevron (30%), SOCAR (50%) and Total (20%), was signed in 1997. The proposal volume of investments to the project was estimated at $3-4 bln. Initially predicted hydrocarbon reserves made 1-3 trillion cubic meters of gas and 150 mln tons of gas condensate. Yet, the first exploration well, revealing small gas reserves was drilled in 2001 and Chevron rejected further works. The contract lost its power in 2005.