Azernews.Az

By Gulgiz Dadashova

Norway's Statoil is interested in expanding its operations in Azerbaijan, Senior Vice President for Eurasia, Middle East and Asia in Statoil ASA, Torgeir Kydland, said at a meeting with President of Azerbaijan's state energy company SOCAR Rovnag Abdullayev.

The launch of exploration work on the Zafar-Mashal block in Azerbaijan's sector of the Caspian Sea following the realization of giant oil and gas projects such as Azeri-Chirag-Guneshli (ACG) and Shah Deniz in the Caspian Sea is important for boosting the company's activities in Azerbaijan, Kydland said at the meeting held at SOCAR's headquarters in Baku on July 9.

He added that SOCAR and Statoil have been successfully co-operating for over 20 years and the company is satisfied with this cooperation.

Regarding the decision of the consortium operating the Shah Deniz offshore gas field of Azerbaijan to transport gas to Europe through the Trans-Adriatic Pipeline, Kydland said that TAP will bring major benefits in ensuring gas supplies to European consumers.

The SOCAR head, in turn, said the cooperation established between Statoil and SOCAR sets grounds for further expansion of the joint activities on the Zafar-Mashal block, and said that the works on joint projects are running on schedule.

Speaking about the TAP project, Abdullayev said that the mentioned decision once again showed to the world that Azerbaijan is committed to the Southern Gas Corridor project.

"We believe that TAP will open up big opportunities to increase Azerbaijan's role in boosting the energy security of Europe," he said.

The sides voiced extensive potential for increased cooperation in the framework of ongoing and planned projects and stressed the importance of defining new prospects to expand it.

According to SOCAR experts, Zafar-Mashal (previously known as D-9 and D-38), a deepwater block located about 110 kilometres southeast of Baku in Azerbaijan's sector of the Caspian Sea, contains 300 billion cubic meters of natural gas and 37 million metric tons of condensate.

The first contract for the development of the prospective Zafar-Mashal offshore structure was signed between SOCAR and ExxonMobil on April 27, 1999. SOCAR had a 50 percent stake in the project, while ExxonMobil had 30 percent and ConocoPhillips held the remaining 20 percent. However, the project was closed after the discovered volumes of hydrocarbons were deemed commercially unattractive.

Azerbaijan is the second largest contributor to Statoil's international production as about 20 percent of international production comes from this resource-rich Caspian state.

Statoil Azerbaijan started its operation in 1992. The company is a partner on Azerbaijan's Shah Deniz field in the Caspian Sea. Statoil also holds 42.5 percent of the shares in TAP.

The Shah Deniz consortium made a decision in favor of TAP to transport Azerbaijani gas to Europe in late June. The Trans-Adriatic Pipeline will bring an initial 10 billion cubic meters of Azerbaijani gas a year across Albania and Greece, and into Italy. First gas is expected in 2019.