Lukoil Signs Caspian Offshore MoU with Iran
Iran’s Khazar Exploration & Production signed a memorandum of understanding (MoU) with Russia’s Lukoil relating to exploration of Iran's sector of the Caspian Sea, Lukoil announced October 4.
Lukoil is the only company operating Russian fields (Filanovsky and Korchagin) in the Caspian Sea; these together produce 2mn mt/yr of oil and 1.2bn m3/yr of associated gas. It also has 10% stake in the BP-led offshore Shah Deniz gas field offshore Azerbaijan, in which Iran’s NICO is also a partner.
The October 4 deal was signed on the fringes of the Gas Exporting Countries Forum, at which Russian and Libyan nominees are vying to replace Iran’s Mohamamd Hossein Adeli as secretary-general of GECF. The forum, once characterised as a 'Gas Opec' has failed to live up to that description despite its heavyweight members, because of the rapid expansion of the global LNG market.
Iran signed another MoU with Lukoil to explore the Abadan region onshore southwest Iran October 4.
In recent years, Iran sought to persuade Lukoil, Statoil and Denmark’s Maersk Oil to participate in offshore Caspian projects, all to no avail, until it now signed up Lukoil. It is not yet clear which Iranian offshore block is to be explored by Lukoil - although the latter has already indicated its interest in the Sardar-e Jangal field - nor when the MoU will be firmed up.
Sardar-e Jangal is on block 6, measures 24 km by 6 km in water depth of 750 meters. Iran has already drilled two exploration wells there, and the field reportedly has reserves of 2bn barrels in place of 39o API crude oil.
The Lukoil offshore deal is the first in two decades signed by Iran relating to its offshore Caspian sector. Tehran previously reached an agreement with the ‘South Caspian Study Group’ consortium of Khazar, Shell, Lasmo (now part of Italy's Eni) and Germany’s now defunct Veba Oil to study Iran’s sector of Caspian Sea. During 22 months in 1999-2001, it explored 86 geological structures, of which 46 were deemed prospects.
Dalga Khatinoglu