BP Set To Sign Gas Field Deal With Azerbaijan's Socar

BP Set To Sign Gas Field Deal With Azerbaijans Socar
Wall Street Journal
Τετ, 6 Οκτωβρίου 2010 - 18:56
BP PLC (BP) is set to sign a deal with Azerbaijan national oil company Socar on Thursday to develop a huge natural gas field in the Caspian Sea, according to a person familiar with the matter.
BP PLC (BP) is set to sign a deal with Azerbaijan national oil company Socar on Thursday to develop a huge natural gas field in the Caspian Sea , according to a person familiar with the matter.

The field, Shafag-Asiman, which is about 125 km south-east of the Azeri capital
Baku , has estimated reserves of 17 trillion cubic feet, according to Socar. That would make it almost as large as Azerbaijan 's massive Shah Deniz gas field, in which BP also has a stake.

Under the deal, a 50-50 production-sharing agreement, BP will carry all exploration costs. It would further cement BP's position as one of the largest foreign investors in
Azerbaijan , an oil-rich former Soviet republic. BP is operator of the huge ACG oilfield in the Caspian, and of the Baku-Tbilisi-Ceyhan pipeline which brings Azeri oil to Turkey 's Mediterranean coast.

The deal will be signed by Bob Dudley, BP's new chief executive, who is currently visiting the company's operations in
Azerbaijan along with his predecessor in the job, Tony Hayward. Socar couldn't immediately be reached for comment.

The Shafag-Asiman contract shows that, however badly BP's reputation in the
U.S. was damaged by the Deepwater Horizon disaster, it hasn't impaired the company's ability to strike big deals in its traditional heartlands.

Developing the field could reinforce
Azerbaijan 's role as a rising gas exporter. It is currently in talks to sell gas from the second phase of production from Shah Deniz with a number of buyers, including the Nabucco consortium which wants to pump Azeri gas through a pipeline across Turkey and into Europe .

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