Azerbaijan

Azerbaijan is one of Equinor’s largest and longest-standing international commitments. We’ve been operating here since 1992 and are one of the largest foreign investors.

0 BOE/D 2020 average production
0 Office located in Baku
0 Established our office in Azerbaijan

A long-standing commitment

Since 1992 Equinor has been a partner in Azerbaijan’s industrial and economic transition. Together with the national oil company SOCAR and other international companies, we have worked both industrially and socially to build Azerbaijan’s burgeoning oil and gas market to realise its full potential.

Equinor (then Statoil) was one of the 11 foreign oil companies that in 1994 signed a Production Sharing Agreement (PSA) with the State Oil Company of the Azerbaijan Republic for the development of Azeri, Chirag and deepwater portion of Gunashli (ACG) - three major oil fields in the Azerbaijan sector of the Caspian Sea.

Today Equinor has an interest in the ACG oil field, as well as the Baku-Tbilisi-Ceyhan (BTC) pipeline, which carries oil from the Sangachal terminal near Baku to the Ceyhan marine terminal on the Turkish Mediterranean coast.

Together with other co-ventures in ACG and BTC, Equinor has been supporting a large portfolio of social investment projects to help create sustainable social and economic development in the local communities along the pipeline route in Azerbaijan, Georgia and Turkey.

Operations in Azerbaijan

The ACG PSA, also known as “the contract of the century”, was signed on 20 September 1994. In September 2017, the PSA was extended for another 25 years, until the end of 2049. Equinor has a 7.27% interest in the extended ACG PSA. bp is the operator of ACG.

 

ACG is the largest oilfield in the Azerbaijan sector of the Caspian basin. It is located around 100 kilometres east of Baku in water depths ranging from 125-180 meters. The development is based on fixed platforms and subsea injection technology. bp currently estimates total recoverable reserves in ACG over the period of extended PSA (2018-2049) at ca 3 billion barrels of oil.  ACG crude oil is sent to Sangachal Terminal, a hub with capacity of 1.2 million barrels, where oil is processed prior to export. 

BTC oil export pipeline is the main export route for the ACG oil. Equinor has an 8.71% interest in BTC project.  BTC pipeline passes Azerbaijan, Georgia and Turkey, connecting the Caspian with the Mediterranean Sea.  Pipeline length is 1768 km: 443 km in Azerbaijan, 249 km in Georgia and 1076 km in Turkey. 

 

Host government agreements with the governments of three countries have been signed in 2003. The agreements have a term of 40 years from the date of first shipment of oil through BTC, which was in 2006. Current BTC throughput including ACG oil is ca 650 million barrels per day.  BTC overall capacity is around one million barrels per day.

On 30 May 2018, Equinor and SOCAR signed a Risk Service Agreement (RSA) related to the appraisal and development of the Karabagh oilfield. Both parties hold equal shares in the project. 

 

The Karabagh oilfield is located 120 kilometres east of Baku. In December 2019, Equinor started drilling the KPS-4 appraisal in water depth of approximately 180 meters. In March 2020, Equinor and SOCAR confirmed oil discovery in the Karabagh field. To operate the licence, Equinor and SOCAR established a 50-50 Karabakh Joint Operating Company (KJOC).

The Production Sharing Agreement (PSA) for the Ashrafi-Dan-Ulduzu-Aypara (ADUA) area in the Caspian Sea was signed between Equinor and SOCAR in May 2018. As per the agreement, both partners hold equal shares.

 

The ADUA exploration area is located around 100-110 kilometres north-east of Baku. In 2019, Equinor conducted a 2D-3D seismic study in the prospect area.

 

You can find our ADUA Azerbaijan Environmental Impact Assessment and public hearing documents here.

Partnerships for the future

Social investment initiatives conducted within ACG and BTC projects in cooperation with local and international implementing partners have been contributing to the development of local communities through jobs creation, educational programmes, strengthening skills and capabilities, ensuring wider access to improved social infrastructure, supporting capacity development of local service providers, and other initiatives.

In February 2019, Equinor signed a Memorandum of Understanding with the Ministry of Energy of Azerbaijan which provides for general principles of cooperation in the field of the use of renewable energy sources in order to assist the development of renewable energy projects in Azerbaijan.

Equinor has joined the Caspian Environmental Protection Initiative (CEPI) pioneered by SOCAR. The Initiative calls for joint active efforts to ensure effective and sustainable protection of the Caspian region environment and to meet the Paris Climate Agreement commitments.

In 2021, Equinor signed a Memorandum of Understanding with United Nations Development Programme (UNDP) on mapping potential areas of cooperation to set-up the terms for the future contribution towards the implementation of the UN Sustainable Development Goals (SDG) in Azerbaijan.

Equinor has been contributing to fostering the next generation of Azerbaijani talent in science and technology through cooperation with major high schools and industry associations. 

How to find us in Azerbaijan

Baku
Marine Plaza Business Center,
62 Uzeyir Hajibeyli Street, 16th floor, 
1095 Baku, Azerbaijan
Tel: +99412 4977340