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21.09.2016 15:26

Rovnag Abdullayev hopes to increase productivity of Contract of Century developed by 60.7% by 1.8-fold

The signing PSA on development of offshore field Azeri-Chirag-Gunashli (ACG), known in Azerbaijan as the contract of the century, marks its 22nd anniversary.

The President of the State Oil Company of Azerbaijan (SOCAR) Rovnag Abdullayev informed that it is planned to receive about 5 bn barrels of oil from ACG field under this contract. Currently it is extracted 407 million tons of oil (about 3.036 bn barrels notes) and 124.3 bn cu m of gas, Abdullayev stated. Excluding associated gas the field, the contract for which timed until 2024, has already been developed by 60.7%. By the implementation of additional investments and by increase of oil recoverability factor it will be possible to produce up to 4 bn barrels from this field until the end of this contract, Abdullayev said.

In other words, he allows the increase of the productivity of the field by 1.8-fold up to 9 bn barrels, but it should be mentioned that it depends on a number of factors. In 2016 the profit oil of Azerbaijan will amount to 60% of overall production from this field, Abdullayev reported. On the one hand, due to the current price situation of the market the additional investments will seriously reduce the share of the profit oil of Azerbaijan in production.

On the other hand, it should be mentioned that the expansion of field development is due to the efficiency of the EPO rate. If the EPO rate calculated as ratio of 1 barrel of oil spent for field development is below 1 to 10-15 barrels, the investments will be inefficient. If the EPO rate is 1 to 4 barrels, the development will be completely inefficient and will not be carried out regardless of price, technological and other parameters.

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