Oil & Gas News

$80m to be invested in onshore Kursangi Qarabagli field
The Salyan Oil Operating Company plans to invest $80m in the development of the onshore Kursangi-Qarabagli oil field in 2003. The Chinese ambassador to Azerbaijan, Chyan Siyun, has told journalists that this sum also includes equipment used to drill new wells and expand operating wells. Specialists from the Chinese National Oil Corporation (CNOC) will utilize modern technology to carry out works in Azerbaijan.
The total investment to develop and renew Kursangi-Qarabagli constitutes $1bn. Oil reserves at the field are estimated at 100-150m tons. This field was discovered in 1960 and has been exploited by SOCAR up to 1997. The highest ever output from the field measured 370 tons per day.
The CNOC has acquired the European Bank of Reconstruction and Development's 30-per-cent and the Delta-Hess alliance's 20-per-cent stake in this oil project. Thus, SNOC, holding 50% interest, shares the project equally with the State Oil Company of Azerbaijan which also commands a share of 50 %.

Chinese companies to restore onshore oil fields
Chinese oil companies intend to expand their scope of activity in Azerbaijan by refurbishing obsolete onshore oil fields. According to Chinese ambassador to Azerbaijan Chyan Siyun. Having carried out research of three onshore oil fields, Chinese specialists have concluded that it is feasible to raise the oil production rate to a commercially viable level. An initial agreement has been obtained from the Azerbaijani government to place those fields at the disposal of the Chinese National Oil Corporation. The Chinese ambassador said all documents had been submitted to the Presidential Administration, the parties were awaiting a presidential decree to establish relevant joint ventures, likely to take place in the first half of this year.

Azeri oil stands at $33.65 per barrel
Recent developments around Iraq have pushed oil prices up by 53 cent per barrel to exceed $36. Of course, this has impacted on Azerbaijani oil prices, which currently stand at $33.65 in world markets. The 2003 state budget had predicted oil prices of $19.5 per barrel. Therefore the rise in world oil prices will add tens of millions of dollar to Azerbaijan's oil income.
The Minister of Finance, Avaz Alakbarov, said that a $1 increase per barrel equates to a AZM100-bn surge in Azerbaijan's revenues from this sector.
The cabinet of Minister is said to have decided to raise wholesale prices of all types of oil products. The new quote, effective from February 1, does not affect crude and gas prices which remain unchanged at AZM268,000 per ton and AZM64,000 per 1,000 cu m accordingly.

IFC, EBRD mission discusses BTC project with Georgian president
The International Finance corporation (IFC) oil and gas department head, Rashad Kaldan, and the European Bank of Reconstruction and Development (EBRD) business team leader, Peter Rainger, met with Georgian President Eduard Shevarnadze, on February 13. The mission's visit to Georgia aims to scrutinize issues regarding to the implementation of the Baku-Tbilisi-Ceyhan oil pipeline project. The visitors became familiar with project progress and considered works already done.  As a result of the trip, the mission will prepare suggestions on future financing of the BTC project.
"We must minimize the project risk and maximize its benefits for people," they said.
President Shevarnadse informed the mission on issues concerning the implementation of the Georgian section of the project.  The visitors pointed out that they would present a final report to the IFC and EBRD boards, and then, future financing of the project would be discussed.

Oil leak fallout eradicated
BP has updated AssA-Irada on the status of remedial and clean up works, undertaken following the oil leakage incident on the Western Route Export Pipeline (WREP) of 18th January 2003.
The leak occurred near the village of Sveneti in the Gori district of eastern Georgia and its impact was minimized by the effective implementation of BP oil spill response procedures.
BP's press statement states:
“The remedial works in kilometer 131 of the pipeline (KP131) are now substantially complete. The final remediation of the access track was finished by 7th February. Following this we will re-plough the area with the agreement of the landowner”.
A full investigation was started immediately and findings will be made public in due course."