Gum Deniz oilfield
Encyclopedia
Gum Deniz is an offshore oil and gas field
in the Caspian Sea
, located 21 km (13 mi) southeast of Baku
, Azerbaijan
.
The field has been in operation since 1955. Gum Deniz has produced approximately 28.9 million tonnes of oil
and 27 billion cubic meters of gas
to date. In March 2009, Azerbaijan drilled its last well No. 478 in Gum Deniz field before new production sharing agreement
for development of the field was signed with a foreign company in December 2009. The well produces 50 tonnes of oil on daily basis.
and Gumdeniz fields. The contract, preceded by MOU
earlier in April was signed by the President of SOCAR, Rovnag Abdullayev
and General Director of Bahar Energy Ltd, Richard McDougall will last 25 years with possibility for extension of 5 more years.
SOCAR announced this was 28th agreement it signed with a foreign investor on production sharing terms. Rovnag Abdullayev emphasized that SOCAR is planning on increase the overall gas production of Azerbaijan
to 1 trillion cm.
According to the agreement, within the next 3 years, Bahar Energy Ltd will drill one exploration well. The first stage of the project includes drilling of 50 wells. In addition to that, all existing wells will be rehabilitated for production. It is estimated that the first stage of the project will bring a profit of $2.5 billion to SOCAR. Second stage of the project consists of exploration of Bahar-2 structure within the Bahar field.
As per the agreement SOCAR is to receive bonus of $2 million as soon as the project program is confirmed, $1 million for every 100 Moilbbl, $5 million once the commercial production starts and $2 million after increase of production capacity by 1.5 times from 2008 production indicators, as planned.
Bahar Energy Ltd owns 80% of the stake while SOCAR is entitled to 20%. It is expected that Bahar Energy Ltd will invest nearly $1 billion in the project.
Oil and gas field
An oil and gas field is a field, or vast reservoir, that contains both oil and natural gas.-See also:* Oil field* Natural gas field* Oil reservoir* List of oil fields* List of natural gas fields...
in the Caspian Sea
Caspian Sea
The Caspian Sea is the largest enclosed body of water on Earth by area, variously classed as the world's largest lake or a full-fledged sea. The sea has a surface area of and a volume of...
, located 21 km (13 mi) southeast of Baku
Baku
Baku , sometimes spelled as Baki or Bakou, is the capital and largest city of Azerbaijan, as well as the largest city on the Caspian Sea and of the Caucasus region. It is located on the southern shore of the Absheron Peninsula, which projects into the Caspian Sea. The city consists of two principal...
, Azerbaijan
Azerbaijan
Azerbaijan , officially the Republic of Azerbaijan is the largest country in the Caucasus region of Eurasia. Located at the crossroads of Western Asia and Eastern Europe, it is bounded by the Caspian Sea to the east, Russia to the north, Georgia to the northwest, Armenia to the west, and Iran to...
.
The field has been in operation since 1955. Gum Deniz has produced approximately 28.9 million tonnes of oil
Petroleum
Petroleum or crude oil is a naturally occurring, flammable liquid consisting of a complex mixture of hydrocarbons of various molecular weights and other liquid organic compounds, that are found in geologic formations beneath the Earth's surface. Petroleum is recovered mostly through oil drilling...
and 27 billion cubic meters of gas
Natural gas
Natural gas is a naturally occurring gas mixture consisting primarily of methane, typically with 0–20% higher hydrocarbons . It is found associated with other hydrocarbon fuel, in coal beds, as methane clathrates, and is an important fuel source and a major feedstock for fertilizers.Most natural...
to date. In March 2009, Azerbaijan drilled its last well No. 478 in Gum Deniz field before new production sharing agreement
Production sharing agreement
Production sharing agreements are a common type of contract signed between a government and a resource extraction company concerning how much of the resource extracted from the country each will receive....
for development of the field was signed with a foreign company in December 2009. The well produces 50 tonnes of oil on daily basis.
New PSA agreement
On December 22, 2009, State Oil Company of Azerbaijan Republic and an Emirati company Bahar Energy Ltd signed a production sharing agreement for exploration, rehabilitation and development of BaharBahar oilfield
Bahar is an offshore oil and gas field in the Caspian Sea, located southeast of Baku, Azerbaijan.The field has been discovered in 1968 and was developed since 1969. Bahar has produced a little over 16.8 million tonnes of oil and 128.7 billion cubic meters of gas up until 2010...
and Gumdeniz fields. The contract, preceded by MOU
Memorandum of understanding
A memorandum of understanding is a document describing a bilateral or multilateral agreement between parties. It expresses a convergence of will between the parties, indicating an intended common line of action. It is often used in cases where parties either do not imply a legal commitment or in...
earlier in April was signed by the President of SOCAR, Rovnag Abdullayev
Rovnag Abdullayev
Rovnag Ibrahim oglu Abdullayev is the director of the SOCAR oil company and has been president of the Association of Football Federations of Azerbaijan since 2008...
and General Director of Bahar Energy Ltd, Richard McDougall will last 25 years with possibility for extension of 5 more years.
SOCAR announced this was 28th agreement it signed with a foreign investor on production sharing terms. Rovnag Abdullayev emphasized that SOCAR is planning on increase the overall gas production of Azerbaijan
Azerbaijan
Azerbaijan , officially the Republic of Azerbaijan is the largest country in the Caucasus region of Eurasia. Located at the crossroads of Western Asia and Eastern Europe, it is bounded by the Caspian Sea to the east, Russia to the north, Georgia to the northwest, Armenia to the west, and Iran to...
to 1 trillion cm.
According to the agreement, within the next 3 years, Bahar Energy Ltd will drill one exploration well. The first stage of the project includes drilling of 50 wells. In addition to that, all existing wells will be rehabilitated for production. It is estimated that the first stage of the project will bring a profit of $2.5 billion to SOCAR. Second stage of the project consists of exploration of Bahar-2 structure within the Bahar field.
As per the agreement SOCAR is to receive bonus of $2 million as soon as the project program is confirmed, $1 million for every 100 Moilbbl, $5 million once the commercial production starts and $2 million after increase of production capacity by 1.5 times from 2008 production indicators, as planned.
Bahar Energy Ltd owns 80% of the stake while SOCAR is entitled to 20%. It is expected that Bahar Energy Ltd will invest nearly $1 billion in the project.
Reservoir
It is estimated that Gum Deniz field holds 4.52 million tonnes of oil and 1.94 billion cubic meters of gas reserves.See also
- Bahar oilfieldBahar oilfieldBahar is an offshore oil and gas field in the Caspian Sea, located southeast of Baku, Azerbaijan.The field has been discovered in 1968 and was developed since 1969. Bahar has produced a little over 16.8 million tonnes of oil and 128.7 billion cubic meters of gas up until 2010...
- Azeri-Chirag-GuneshliAzeri-Chirag-GuneshliAzeri–Chirag–Guneshli is a large complex of oil fields in the Caspian Sea, about off the coast of Azerbaijan. An overall estimated area of the field is . It is operated by a BP-led consortium. The ACG fields have estimated recoverable reserves of about of petroleum...
- Baku–Tbilisi–Ceyhan pipeline
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- Nabucco pipelineNabucco PipelineThe Nabucco pipeline is a proposed natural gas pipeline from Erzurum in Turkey to Baumgarten an der March in Austria diversifying natural gas suppliers and delivery routes for Europe. The pipeline attempts to lessen European dependence on Russian energy...
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