BP’s Azeri Oil Output Declined

BP’s Azeri Oil Output Declined

Output from Azerbaijan’s Azeri-Chirag-Guneshli (ACG) oilfields declined to an average 656,000 barrels per day (bpd) in the first half of 2014 from 672,000 bpd in the same period last year, BP-Azerbaijan said in a statement.

BP said earlier this year that oil production at the ACG fields might be slightly lower than in 2013 as the company planned maintenance work at the Central Azeri and West Azeri platforms, halting operations for a couple of weeks.

The company reported the giant Azeri-Chirag-Gunashli (ACG) block of oil and gas fields in the Azerbaijani sector of the Caspian Sea produced 118.8 million barrels or approximately 16 million tons of oil.

BP is operating a number of major oil and gas projects on behalf of its co-ventures in Azerbaijan, Georgia, and Turkey.

In the first half, the project’s operational and capital expenditures amounted to $479 million and $1.231 billion respectively.

For the full year, it plans to spend approximately $1.052 billion in operating expenditure and $2.068 billion in capital expenditure.

The report also said BP delivered around 6.6 million cubic meters of ACG associated gas per day (1.2 billion cubic meters or 42.3 billion in total) to SOCAR in the first six months.

ACG delivered 8 oil producer wells and 1 water injection well.

The ACG block of fields has been active since 1997. Production started from the Chirag part of the field. It was followed successfully by Azeri Project; Central Azeri production in February 2005, West Azeri in December 2005, and East Azeri in October 2006.

The Deepwater Gunashli section launched production in April 2008.

ACG participating interests are BP (operator – 35.8 percent), SOCAR (11.6 percent), Chevron (11.3 percent), INPEX (11 percent), Statoil (8.6 percent), ExxonMobil (8 percent), TPAO (6.8 percent), ITOCHU (4.3 percent), ONGC Videsh Limited (OVL) (2.7 percent).

The giant Shah Deniz gas condensate field in the Caspian Sea produced 4.75 billion standard cubic meters of gas and about 1.12 million tons (9 million barrels) of condensate.

Daily production at the field amounted to about 26.2 million cubic metres of gas and 49,757 barrels of condensate.

“Since the start of Shah Deniz production in late 2006 until the end of the second quarter 2014, about 52.7 bcm of Shah Deniz gas and about 108.5 million barrels (over 13.6 million tons) of Shah Deniz condensate has been produced,” BP said.

The volume of operating expenditures and capital in the reported period was around $243 million and over $1.766 billion respectively. For the full year, around $483 million is planned to be spent for operating expenditure and $3.781 billion for capital expenditure.

“The great majority of this capital expenditure is on the Shah Deniz Stage 2 project, which includes both offshore developments and expansion of the Sangachal terminal,” BP noted.

The Shah Deniz field, one of the world’s largest gas-condensate fields, was discovered in 1999. Its reserves are estimated at 1.2 trillion cubic meters of gas. Overall, the field has proved to be a secure and reliable supplier of gas to Azerbaijan, Georgia, Turkey, and Europe.

Shah Deniz participating interests are BP, operator (28.8 percent), SOCAR (16.7 percent), Statoil (15.5 percent), Total (10 percent), Lukoil (10 percent), NICO (10 percent) and TPAO (9 percent).

The Baku-Tbilisi-Ceyhan pipeline (BTC) exported about 134 million barrels (17.8 million tons) of crude oil in the reported period.

BTC spent $100 million in operating expenditure and $61.3 million in capital expenditure. For the full year, BTC operating expenditure is expected to be approximately $230 million and capital expenditure about $119 million.

BTC’s throughput capacity is currently 1.2 million bpd.

The 1,768-kilometer BTC pipeline which became operational in June 2006 carries mainly ACG oil and Shah Deniz condensate from Azerbaijan. In addition, crude oil from Turkmenistan continues to be transported via BTC.

The BTC Co. shareholders are BP (30.1 percent); AzBTC (25 percent); Chevron (8.9 percent); Statoil (8.71 percent); TPAO (6.53 percent); ENI (5 percent); Total (5 percent), ITOCHU (3.4 percent); INPEX (2.5 percent), ConocoPhillips (2.5 percent) and ONGC (BTC) Limited (2.36 percent).

The daily average throughput of the South Caucasus Pipeline’s (SCP) was 17.8 million cubic metres of gas or 108,137 barrels of oil equivalent in the first half of 2014.

SCP spent $22.4 million in operating expenditure and $325 million in capital expenditure. For the full year, operating expenditure is expected to be $50 million. As a result of the ramp-up in the SCP expansion, capital expenditure will increase to $1.25 billion.

The SCP pipeline has been operational since late 2006, transporting gas to Azerbaijan and Georgia, and since July 2007 to Turkey from Shah Deniz Stage 1.

The SCP Co. shareholders are BP, operator (28.8 percent), SOCAR (16.7 percent), Statoil (15.5 percent), Total (10 percent), Lukoil (10 percent), NICO (10 percent) and TPAO (9 percent).

Meanwhile, The State Statistics Committee of Azerbaijan reported oil and gas industry dropped by 3.4% in the first half of 2014. Decline was registered previous months, too: 3.0 % in May and April, 3.6% in March, 4.8% in February and 5.2% in January, growth by 1.1% in 2013.

In June oil production in Azerbaijan declined by 5.4% compared to May 2014. Crude oil production by all producers in Azerbaijan totaled 158.287 million barrels for Jan-Jun against 321.4 million barrels in 2013, 320.667 million barrels in 2012, 338.467 million barrels in 2011, 379.224 million barrels in 2010, 375.807 million barrels in 2009 and 332.07 million barrels in 2008.

The State Statistics Committee reports that over Jan-Jun the country produced 21.218 million tons of oil that is by 2.7% less than production for the 2013 same term. Oil stocks as of 1 July 2014 totaled 270,800 tons versus 344,100 tons a month earlier. In May it was produced 3.69 million tons of oil (this year’s best figure), but in June production dropped to 3.47 million tons.

In 2013 the country produced 43.08 million tons (+0.2%). Production totaled 3.815 million tons in May (the highest level in 2013). Oil production for the 4th quarter of 2013 reached 10.545 million tons.

Oil production for the 4 quarter of 2013 reached 10.545 million tons.

In 2012, the country produced 42.984 million tons of oil, including 3.9 million in January – last year’s highest production per month. In 2011, the country was produced 45.37 million tons of oil, including 4.104 million tons in March (the best index for 2011). In 2010 oil production amounted to 50.8 million tons of oil, including 4.5 million tons in August (the best index for 2010).

© CESD, 2014

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