Commonwealth Oil & Gas Co. Ltd. sold an 11% holding in the exploration, development, and production sharing agreement for the Southwest Gobustan oil and gas concession in Azerbaijan to a unit of Oklahoma-based Sooner International Petroleum Co. Ltd. Sooner received an option to purchase another 5%.
Commonwealth Oil & Gas subsidiary Commonwealth Gobustan Ltd. now holds 69% of the concession. Sooner Gobustan Petroleum Co. Ltd. holds 11%, and an affiliate of State Oil Co. of Azerbaijan Republic holds 20%.
Unspecified consideration for the purchase will be transferred to the joint operating company that will be formed to work the field. The funds will be used to begin workover operations on the concession, which contains 137 cased wells on nine structures that have been shut in or abandoned. Another six structures remain undrilled.
Production from the field is expected to begin within 6 months of starting field operations, Commonwealth said. Existing pipelines make working in the area more attractive, says the firm.
Southwest Gobustan encompasses 604 sq km over three blocks in Azerbaijan, 60 km southwest of Baku. Commonwealth said data provided by SOCAR implies proven, probable, and inferred reserves of 700 million bbl of oil and 800 bcf of gas. SOCAR estimates recoverable reserves at 308 MMboe for the nine previously drilled structures.
Commonwealth is a unit of A&B Geoscience Corp., a company incorporated in Anguilla, British Virgin Islands.
Union Texas Petroleum Corp. originated the project, also known as Qobustan, in the mid-1990s and sold its interest to Commonwealth upon its acquisition by ARCO (OGJ, June 8, 1998, p. 40).
