Total Boosts Absheron Stake After Engie Quits
Friday 5 May 2017
France's Total has increased its stake in the Absheron licence off Azerbaijan in the Caspian Sea by 10% to 50% after the exit of compatriot and former project partner Engie.
Engie's 20% interest has been split equally between remaining partners Total and Azeri state oil company Socar after quitting the project, said sources, who declined to give other details of the transaction.
Sources said the decision was recent and the partners are in talks to finalise terms by early June.
"There are some obligations that have to be sorted out before Engie's exit, for example covering bonuses and cash calls" one source said.
First gas from Absheron is now expected in late 2019, based on a fast-track development scheme, Total Azerbaijan managing director Denis Lemarchal told the Caspian Energy publication.
“We submitted the development programme in November 2016. It was approved by the authorities on 1 March,” he said, adding that drilling of the project's production well will start this autumn.
According to Lemarchal, the simplified first phase will produce 1.5 billion cubic metres per annum of gas.
"We will drill a subsea well in a water depth of 450 metres and tie it back to an existing facility at Socar’s Oil Rocks (Neft Dashlary) field," he said.
A small unmanned platform to be installed at Oil Rocks will be bridge-linked to Socar’s existing facilities, company sources familiar with the project said.
“The first well at Absheron will be about 25 kilometres from the platform," sources said, adding that production from the single well will not exceed 4.3 million cubic metres per day of gas and 2000 tonnes per day of condensate.
According to the sources, Oil Rocks has enough spare capacity to receive gas and condensate from Absheron as well as produced water for further utilisation.
However, upgrade work is required to bring it in line with Total technical and safety standards.
In mid-April, Total vice president for security Nicolas Brunet, visited Oil Rocks, Socar said. He reviewed a gas turbine power plant, gas compressor station and other facilities that will be involved in the future Absheron phase one development.
However, no decisions have yet been taken on a further development stage targeting production of between 5 Bcm and 6 Bcm per annum from Absheron, according to Lemarchal.
Absheron's phase one gas is due to be sold to the domestic market. Located in waters ranging from 400 to 650 metres, the Absheron field is estimated to host as much as 350 Bcm of natural gas reserves and 45 million tonnes of condensate.