Russian oil firm Lukoil has agreed to acquire a stake in a BP-operated offshore project in the Azerbaijan part of the Caspian Sea.
Lukoil will take a 25% stake from BP, which will retain a 25% stake and remain the operator of the project called the Shallow Water Absheron Peninsula (SWAP) exploration project. Azerbaijan's state-owned oil firm SOCAR holds a 50% stake.
The deal is expected to complete before the end of 2021, following its approval by the government of Azerbaijan.
The SWAP project area is located in the shallow waters south of the Absheron Peninsula in the Azerbaijan sector of the Caspian Sea. The SWAP production sharing agreement was signed between bp and SOCAR in December 2014.
The SWAP contract area stretches along the margins of the Caspian basin to the south of the Absheron peninsula. The acreage features water depths of up to 40 metres with potential reservoir depths of 2,000-5,000 metres.
In 2016, a 3D seismic acquisition program was conducted in the area, which resulted in defining three prospective areas – North Khali, Bibi-Heybat East, and Garabatdag. The areas feature water depths of up to 40 meters.
Following completion of the processing and interpretation of the 3D data acquired from the contract area, a Notice of Prospectivity was submitted to SOCAR in 2017 in respect of three prospective areas – North Khali, Bibi-Heybat East and Garabatdag, with one exploration well planned to be drilled in each of the prospective areas.
The first exploration well in the North Khali prospective area was spudded in August 2021 and the drilling is expected to be completed in the fourth quarter of 2021. The well is planned to reach total depth of up to 2,424 meters. The well data will then be analyzed and, if successful, an evaluation program may be conducted to confirm the results.
Vagit Alekperov, Lukoil President said: "LUKOIL's joining of the project of bp and SOCAR falls in line with both Russia's and Azerbaijan's national interests related to the evolvement of international cooperation in the energy domain. I am convinced that all the scientific and technical resources gathered by the partners will boost the development of the prospective area in the shallow waters of the Absheron Peninsula," said
"We are pleased to welcome LUKOIL to the SWAP partnership, building on our successful relationship in the Shah Deniz project. We look forward to working closely with them and SOCAR on the exploration work program, which, if successful, will deliver value to Azerbaijan and to our partnership," said Gary Jones, BP's regional president for Azerbaijan, Georgia, and Turkey.