French oil major Total and the national oil company of Azerbaijan Socar have signed an agreement for a first phase of production of the Absheron gas and condensate field, located in the Caspian Sea.
The agreement, announced on Monday, is meant to establish the contractual and commercial terms for the first phase of production from the field, discovered by Total in 2011.
Total is the operator of Absheron with a 40% interest alongside Socar, with 40% interest, and Engie, with the remaining 20% interest.
“I’m delighted with this agreement, which we sign on the occasion of the 20th anniversary of Total’s presence in Azerbaijan, and which represents an important step to monetize the Absheron discovery made by Total in 2011,” said Patrick Pouyanné, Chairman and CEO of Total.
“This agreement was made possible by the close cooperation between Total and Socar, which has allowed us to design a cost-competitive development scheme by tying the field to existing infrastructure in order to deliver gas at a competitive price,” Pouyanné added.
According to Total, the development involves the drilling of one well at a water depth of 450 meters. Production from this high pressure field will be around 35 thousand barrels of oil equivalent per day, including a significant portion of condensate. The produced gas will supply Azerbaijan’s domestic market.
Total added that this first phase of production will also enable a dynamic appraisal of the field for future phases.