Subsea 7 said on Monday it has been awarded two contracts, together worth between $50 million and $150 million, by BP for the Azeri Central East (ACE) project in the Azeri-Chirag-Deepwater Gunashli (ACG) field in the Caspian Sea in a water depth of approximately 140 meters.
The work scopes comprise engineering and fabrication of subsea structures, engineering, transport and installation of spools, the launching of a 16,200-metric-ton jacket and the float-over of an 18,500-metric-ton topside.
The contracts will be executed in consortium with BOS Shelf, which will be responsible for the fabrication, logistics and facilities support. Engineering work shall commence immediately from Subsea 7’s office in France and offshore execution is expected to take place in 2021 and 2022.
Gilles Lafaye, Subsea 7 Vice President for Africa, noted that this project reflects long-standing relationships and cooperation with BP Exploration, and is also based on the activities of Life of Field in Azerbaijan.
“We look forward to expanding our presence in the Azerbaijani market through safe and reliable solutions for our developments in the field of offshore energy,” Lafay said.
The final investment decision on the Central-Eastern Azeri platform was adopted on April 19 this year. The $6 billion project includes the construction of a new offshore platform and facilities that will provide daily oil production of 100 thousand barrels. Over the entire period of the platform operation, it is planned to produce 300 million barrels of oil. The first production is expected in 2023.
It should be noted that on September 20, 1994, the State Oil Company of Azerbaijan (SOCAR) and a consortium of 11 oil companies representing six countries signed a production sharing agreement on the development of the Azeri-Chirag-Deep-Water Gunashli (ACG) field block. In September 2017, the term of the agreement was extended to the middle of the century.
The potential for investing in ACG will be more than $40 billion over the next 30 years.
Currently, about 550 thousand barrels of oil per day are produced at the ACG field. From the start of production in November 1997 to the end of the second quarter of 2019, about 488 million tons (more than 3.6 billion barrels) of oil were produced from the fields. Oil is exported to world markets mainly through Baku-Tbilisi-Ceyhan (BTC) and the Western Export Pipeline (Baku-Supsa).
ACG oil field is located in the Azerbaijani sector of the Caspian Sea, about 100 km east of Baku. The depth of the reservoir is 2000-3500 m.
To date, the shareholding of ACG partners is distributed as follows: BP - 30.37%, SOCAR - 25.00%, Chevron - 9.57%, Inpex - 9.31%, Equinor - 7.27%, ExxonMobil - 6.79%, TPAO 5.73%, Itochu 3.65% and ONGC Videsh Ltd. (OVL) - 2.31%.