BAKU, Azerbaijan, June 4. The State Oil Company of the Azerbaijan Republic (SOCAR) expects to start production at the Karabakh field in the Caspian Sea in the near future, SOCAR Vice President Babak Huseynov told reporters, TurkicWorld reports.
"Karabakh already has three exploration wells and one appraisal well drilled earlier by Norway's Equinor. The field was discovered in March 2020. Hydrocarbon reserves have been confirmed, so we want to start production shortly," he said.
SOCAR now manages the project after Equinor left. Over 40 million tons of oil are estimated in the Karabakh field in the Caspian Sea, with over 21 million recoverable.
Previous work was based on the Risk Service Contract signed by SOCAR and Equinor on May 30, 2018, in Baku. Oil production from Karabakh was expected to start in 2025–2026, with an estimated average output of 5,000 tons of oil and 4.5 million cubic meters of gas per day. A stationary platform for this purpose is being built in Baku's Garadagh district at SOCAR's plant.
To note, SOCAR first attracted foreign partners to explore the Karabakh field in 1995, through a Production Sharing Agreement (PSA) with Devon, Lukoil, Agir, and LUKAgiр (CIPCO consortium). Hydrocarbons were identified after drilling three wells. However, the global oil crisis of 1998–1999, which saw oil prices drop to $12–15 per barrel, halted the project's progress, and the PSA for Karabakh was canceled on February 23, 1999.
Currently, the average oil price is around $90 per barrel, but Equinor's priorities have shifted, and the company is unwilling to invest in the Karabakh field due to its relatively small recoverable reserves. The Karabakh field was originally discovered by Azerbaijani oilmen in the Caspian Sea in 1959, following seismic surveys conducted 120–130 km east of Baku.
