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Azerbaijan and Franceâ€™s Total sign agreement on Absheron offshore block

27 February 2009 10:01 (UTC +04:00)

Under the deal, Total will be the operator of the Absheron Block, with a 60 percent interest and SOCAR Venture will hold 40 percent.
Rovnag Abdullayev, President of SOCAR, said the parties made their minds to enter into a contract amid the growing global interest in hydrocarbons.
â€œAs a contractor in the project for three years, Total will have to drill a well there. If it doesnâ€™t drill, it will have to drill two wells within the next three years,â€ he added.
Natig Aliyev, Azerbaijanâ€™s Minister of Industry and Energy, praised Azerbaijanâ€™s increasing global role in oil and gas production, underscoring the importance of Caspian hydrocarbons for Europe.
He expressed hope for the success of the contract on development of the Absheron Block.
Vice-President of Total mentioned the companyâ€™s cooperation with Azerbaijan since 1996 and its participation in Shah Deniz Project, expressing hope for the success of this contract.
Rovnag Abdullayev, President of SOCAR, added that his country signed 27 oil and gas development contracts during recent years.
â€œAs result, $30 billion was invested in Azerbaijan. Foreign investment plays a vital role in the development of oil and gas fields. We are now cooperating with 30 companies of 20 countries including the USA, Russia, China, Canada, Germany, the UAE, Ukraien and others.
In June 2008, Franceâ€™s Total signed an agreement with State Oil Company of Azerbaijan (SOCAR), setting out the main conditions and commercial principles of an exploration, development and production sharing agreement for Absheron offshore oil and gas block.
Total (20%), U.S. energy firm Chevron Corp. (CVX) (30%) and SOCAR (50%) had previously signed a deal in 1997 to develop the Absheron field while Chevron and Total abandoned the project in 2001 after drilling the first well, saying it wasnâ€™t commercially viable.
The foreign companies compensated SOCAR and the contract terminated in 2005.