Total to begin Absheron drilling in September

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, Feb. 3 -- The Total SA-led consortium plans to begin drilling its first exploration well on the Absheron block off Azerbaijan in September, according to a senior official of State Oil Co. of Azerbaijan Republic (SOCAR).

SOCAR Pres. Rovnag Abdullayev estimated costs of the well at $100-120 million. Plans call for the well to be drilled to more than 7,000 m in 500 m of water 100 km from Baku. Reports said Maersk’s Heydar Aliyev drilling rig will be used for the well.

This is Azerbaijan’s second attempt to start production at the Absheron prospect, which was earlier covered by a production-sharing agreement operated by Chevron Corp., in which Total and SOCAR were also partners.

Azerbaijan had high hopes of a major gas find in the area, but the partners’ first exploration well in 2001 failed to find commercially viable reserves and plans for a second well in 2003 were eventually shelved.

According to Azerbaijan government data, proven reserves at the structure amount to 300 billion cu m of gas and 45 million tonnes of condensate.

Under the terms of the current PSA, the Total-led consortium must drill one exploration well in the first 3 years. If the results are successful, the consortium would have an additional 3 years to drill two more wells.

The 30-year PSA for Absheron field was signed Feb. 27, 2009, between SOCAR and Total (OGJ Online, Feb. 27, 2009). Total later sold part of its original 60% stake to Gaz de France Suez, rendering the project participants as Socar 40%, Total 40%, and GDF Suez 20%.

Contact Eric Watkins at hippalus@yahoo.com.