01 July 2003 21:23
LUKoil pays 78.6m USD to advance participation in D-222 project
Russian oil giant LUKoil has paid Azerbaijan about 78.6m US dollars to increase its participation in a project to
develop the D-222 (Yalama) block in the Caspian Sea.
Executive Director of the State Oil Fund of Azerbaijan (SOFAR) Samir Sarifov said the Russian company had transferred
48.6m dollars to the Fund as a bonus to the Azerbaijani government for expanding the contract zone, as foreseen by the
agreement to explore and develop the block.
"In addition to the bonus, the State Oil Company of the Azerbaijani Republic (SOCAR) received about 30m dollars
from selling Lukoil 20 percent," Mr. Sarifov said.
The agreement to explore, develop and share production at the D-222 block in the Azerbaijani sector of the Caspian
Sea was signed on July 3, 1997 in Moscow, during an official visit of Azerbaijani President Heydar Aliyev to Russia.
Participants in the project included Lukoil (60 percent) and SOCAR (40 percent). A packet of additional documents was
signed in Baku this April, according to which the contract zone was expanded from 1,287 square km to 3,037 square km.
SOCAR recently transferred 20 percent to the Russian company giving LUKoil an 80 percent share in the project, and
leaving SOCAR 20 percent.
The contract zone is part of the Qusar-Davaci oil and gas basin located 200-250 km north of Baku, where sea depth
ranges between 20 and 650 meters. The sea depth at the point of well drilling totals 339 meters. Productive horizons are
forecast at depths of 1,500 meters to 2,500 meters, 30 km off shore. The location of a second exploration well will be
established based on the results from the first well. The new wells are expected to yield up to 500 tons of oil per day.
Predicted recoverable reserves total 90 million tons of oil. Exploratory drilling will begin at Yalama in the second
half of 2004.
[AIW [Asia Africa Intelligence Wire]] |
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