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Oil production has begun at the new Azeri Central East (ACE) rig, part of the Azeri-Chirag-Gunashli (ACG) oil field, a MOL (Hungarian multinational oil and gas company) interest, in the Azerbaijani sector of the Caspian Sea, announced BP, the operator of the ACG project.
The ACE platform is the seventh rig to be installed at the giant ACG field in the Caspian Sea, the Azeri Trend news agency reported. Production at the ACG began in 1997, and since then, more than 4.3 billion barrels of oil have been brought to the surface with the six rigs that have been drilled so far.
The seventh rig and its associated facilities are designed to process 100,000 barrels of oil per day and are expected to extract 300 million barrels of oil over the life of the project.
The oil will pass through the processing facilities on the offshore platform and then through a new pipeline to a 30-inch submarine pipeline to the onshore Sangachal terminal, some 130 kilometers away.
ACE’s initial production will come from its first well, developed at the end of the year. Volumes are expected to increase to 24,000 barrels per day by the end of 2024, once the two additional planned wells are commissioned.
BP has a 30.37% stake in the ACG project, Azerbaijan’s Socar 25%, MOL 9.57%, Japan’s Inpex 9.31%, Norway’s Equinor 7.27%, and ExxonMobil 6.79%.
In 2020, the Hungarian company already talked about ramping up production at the ACG field from 2024, after the seventh rig starts operating, Tamás Pletser, an oil and gas market analyst at Erste told Világgazdaság.
Azeri-Chirag-Gunashli complex projected production profile. Photo via Wikipedia.
“The development has been going on for two to three years, uninspired by the current price of USD 90, although I assume the operators do not mind” the analyst added.
Pletser also pointed out that the production sharing agreement (PSA) with the Azeri state reduces the profits of the consortium members at high oil prices, as a higher price gives Azeris a larger share of production, but only if the project revenues have already covered the costs.
MOL could increase its oil production by 3-5,000 barrels per day with the start-up of the seventh rig.
Via Trend, Világgazdaság; Featured image via Facebook/MOL