BP, Azerbaijan discuss Caspian projects Karabagh, Shafag-Asiman, prospects of Babek structure
BAKU. April 16 (Interfax) - UK oil and gas major BP plc's regional president for Azerbaijan, Georgia and Turkey, Giovanni Cristofoli and Azerbaijan's Energy Minister Parviz Shahbazov discussed the current situation on energy markets and the outlook for the development of the Shafag-Asiman, Karabagh and Babek fields in Azerbaijan's sector of the Caspian Sea on Wednesday, the Energy Ministry reported.
"During the meeting, the implementation status of ongoing projects carried out within the framework of the strategic partnership with BP, as well as prospects for future cooperation in the oil, gas, and renewable energy sectors were discussed. In this context, efforts aimed at maintaining stable production at the Azeri-Chirag-Gunashli (ACG) field, the application of new technologies, and the enhancement of operational efficiency were reviewed," the ministry said.
Cristofoli and Shahbazov discussed activities at the Shah Deniz field and the development of the project to build the SDC compression platform there, and updates on the production of the first gas under the project to process associated gas from ACG.
Issues related to the development of Shafag-Asiman, Karabagh and Babek fields were also discussed and prospective opportunities were assessed. "It was noted that these projects will make a significant contribution to increasing the country's gas export potential," the ministry said.
Cristofoli and Shahbazov also reviewed progress on the electrification of oil and gas platforms and the Sangachal terminal, as well as ongoing work toward commissioning the Shafag Solar Power Plant in 2027.
They stressed the priority of energy security amid the current situation in global energy markets, and the importance of diversifying energy sources, routes, and supply, the ministry said.
BP is currently a participant in the projects to develop the Karabagh field and Shafag-Asiman block, but it is not in any way involved in the project to develop the Babek prospective structure, which is part of the Umid-Babek block.
BP acquired a 35% participating interest in the Karabagh project last year, joining the existing risk service contract for the field. The agreement formalizing the deal was signed on June 3, 2025 with the State Oil Company of Azerbaijan Republic (SOCAR), which retained the other 65% interest in the project. BP will serve as project operator.
BP expects to produce the first oil at Karabagh in 2029. The field, located 120 km east of Baku, 20-25 km from the Gunashli field at depths of 150-200 meters, has in-place reserves of more than 60 million tonnes of oil and recoverable reserves of 21 million tonnes of oil and 13 billion cubic meters of gas.
The contract to develop the Shafag-Asiman block between SOCAR and BP Exploration went into effect in June 2011. It has a term of 30 years, with an option for a five-year extension. BP and SOCAR currently have a 50-50 production sharing agreement on the project, where BP will remain operator for the exploration period. However, Turkey's TPAO signed several agreements with SOCAR and BP on June 2, 2025 to join the contract to develop the block.
The Shafag-Asiman block, discovered in 1961, covers an area of 1,100 square km, 125 km southeast of Baku, where water depths range from 650 to 800 meters.
The risk service contract for the exploration and development of the Umid-Babek block, which is located in the deep water part of Azerbaijan's sector of the Caspian, 75 km from Baku at a depths of 60-700 meters, was signed by SOCAR and SOCAR Umid Oil and Gas Limited in 2017 and went into effect in May of that year. There is also an exploration and development agreement for the block between SOCAR Umid Oil and Gas Limited and Umid, Babek Exploration & Production attached to the contract.
