Statoil 'in talks for Azeri mega-project'

Turning the wheels: Statoil for new project in Azerbaijan

Statoil is reported to be in talks with Azerbaijan’s state oil company Socar for participation in a new giant project in the Caspian country.

The Norwegian state oil company is believed to be looking to take a major role in developing a cluster of fields – Umid, Babek, Zafar and Mashal – centred on the Umid gas discovery, based on a similar model to the BP-operated Azer-Chirag-Gunashli (ACG) project in which Statoil is a partner, according to DN.

International development and production chief Lars Christian Bacher visited the capital Baku earlier this month for discussions with Socar and also presented the company’s plans to President Ilham Aliyev, the Norwegian business daily reported.

The trip was in conjunction with a state visit by Norwegian Foreign Minister Espen Barth Eide, helping to promote the state oil company’s bid.

While details of the proposed scheme are being kept tightly under wraps, it is believed to be of an equivalent size to the ACG scheme in the Caspian Sea – one of the world’s largest oil and gas fields with remaining recoverable reserves estimated at up to 6 billion barrels.

Statoil currently participates as a partner in the ACG and Shah Deniz offshore projects, both operated by BP, but Bacher said the company aims to expand its presence and play a bigger role in Azerbaijan.

“Our ambition is to build up our business, strengthen our position and gain an operatorship,” Bacher said, adding that Statoil “has a very good dialogue with Socar”.

Statoil has been active for the past 20 years in Azerbaijan, which currently generates oil and gas output of 100,000 barrels of oil equivalent per day for the company.

It has set a production goal of 2.5 million barrels of oil equivalent per day by 2020, a large portion of which is set to be sourced from the company’s international activities.

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