- Industry and Energy
USD 265 bln. invested in Azerbaijan since signing “Contract of the Century”
"In the last 25 years, the annual oil production has grown fourfold in our country, recovering all branches of economy. Some essential technologies and innovative solutions were applied in the Azerbaijani sector of the Caspian Sea, in order to develop the deepwater fields. Around $265 billion were invested in total in the economy of Azerbaijan during these years, whilst the amount of investment in the oil and gas industry totaled $101 billion with around $36 billion invested by the ACG partners alone in the development of these fields," SOCAR President Rovnag Abdullayev said, APA-Economics reports.
This contract, which later became known as the “Contract of the Century”, was extended in September 2017 until the end of 2049.
SOCAR president Rovnag Abdullayev said: “Today we celebrate the 25th anniversary of the PSA on the Azeri, Chirag and Deepwater Gunashli fields, known as the “Contract of the Century”. This contract has played a unique role in the history of independent Azerbaijan. Although shorter than a moment from historical perspective, these 25 years passed in the atmosphere of strenuous day-to-day work. Looking back at this track of success and the magnificence of the projects we’ve accomplished, we’re filled with a sense of pride.
Gary Jones, BP’s Regional President for Azerbaijan, Georgia and Turkey, said: “The 25th anniversary marks an important milestone in the new history of Azerbaijan’s oil and gas industry. It is a historical date for SOCAR, BP and all other partners in the ACG contract.
“What has been achieved by this contract since 1994 is extraordinary. It is with this contract that the massive developments, turning Azerbaijan once again into one of the world’s major energy suppliers and transforming the country’s economy, started. One reason for this success is the extraordinary partnership built here within ACG. And for that we want to pay tribute to President Aliyev, his government and SOCAR. Together we have demonstrated what partnership can deliver.”
These are some of ACG’s key facts:
From the start of production in November 1997 till the end of 2Q 2019, ACG produced about 488 million tonnes (more than 3.6 billion barrels) of oil.
Around 3.3 billion barrels of ACG oil have been exported to world markets via the Baku-Tbilisi-Ceyhan pipeline.
Since 2006, 4,300 tankers loaded with ACG oil have been lifted from the Ceyhan terminal.
More than 44 billion cubic meters of associated gas were delivered to Azerbaijan since the start of production till the end of 2Q 2019.
Capital expenditure in the ACG project by the end of 2Q 2019 was $36 billion.
From the start of ACG project in 1994 till the end of 2Q 2019, the ACG partners spent around $84 million on sustainable development projects in Azerbaijan.
On 14 September 2017, the ACG PSA was extended until end of 2049.
Following PSA extension, ACG’s $6-billion next development project – Azeri Central East (ACE) was sanctioned 19 April 2019 and is currently at the execute stage with first oil expected in 2023.
As part of the ACG project – one platform (Chirag 1) was renovated and seven new platforms were built, one of the largest oil and gas storage and processing terminals of the world was constructed, a sophisticated web of subsea pipelines was laid at the bottom of the Caspian Sea.
At the end of the 2Q of 2019, 124 oil wells were producing, while 44 wells were used for water and for gas injection.\ACG has had excellent safety record and, as an environmentally sound project, it has conducted around 140 Environmental Impact Assessments and 266 offshore, onshore and near-shore monitoring surveys.
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