Eric Watkins
Senior Correspondent
LOS ANGELES, May 20 -- Azerbaijan President Ilham Aliyev has approved three production-sharing agreements (PSAs) for onshore oil fields.
The approved projects include an agreement between the State Oil Co. of the Azerbaijan Republic (Socar) and the UK's Caspian Energy Group for development of Kyurovdag field; an agreement with Noble Sky, a joint venture of China's Shengli Oil and Azerbaijan's Middle East Petroleum, for rehabilitation and development of Garachukhur field; and an agreement with AZEN (a 50-50 JV of Istanbul-based Enka and Azerbaijan's AzPetrol Group) for development of Binagadi field.
Socar and Caspian Energy Group each have a 50% interest in Kyurovdag. The contract has a 25-year term with an option to extend by 5 years.
The 115 sq km field, identified in 1955, covers three blocks: North, Central, and South Kyurovdag. Oil reserves total 5.5 million tonnes.
The PSA for Binagadi also was signed for 25 years with the option of extending for 5 years. Socar holds a 25% share, and AZEN, which must pay a $1 million bonus within 30 days, holds a 75% share.
The 43.46-sq km contract area includes six fields, the largest of which is Binagadi, where production began in 1896. Reserves are estimated at 5.5 million tonnes.
Socar has a 25% stake in the project to rehabilitate and develop Garachukhur field, and Noble Sky holds 75%. The contract covers 11.5 sq km.
The field produces from 45 wells.
