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US firms to exit oil field poised to decrease EU dependence on Russia – Report

Gasoil News - Published on Mon, 10 Dec 2018

Image Source: sputniknews.com
Sputnik reported that two American firms were among the first to invest in the republic after the dissolution of the USSR, basically kick-starting the oil production in the country 25 years ago. The US also invested heavily in a project, deemed as alternative oil source for Europe. Two major American oil producers are reportedly seeking to sell their shares in Azerbaijan's largest oilfield Azeri-Chirag-Gunashli (ACG), Reuters reported on 4 December, citing anonymous sources in the energy industry. According to the report, Exxon Mobil is counting on getting up to USD 2 billion for its 6.8% in the joint venture. Another US company, Chevron, is also reportedly hoping to sell its 9.57% in the ACG, as well as 8.9% in the Baku-Tbilisi-Ceyhan pipeline.

The Baku Aquatics Centre, one of the venues of the 2015 European Games stands in the background, as an oil pump works a nearby field in Baku, Azerbaijan. Representatives from Exxon Mobile and Azerbaijan's state-owned company Socar have declined to comment on the report.

Both companies entered the joint venture with several other firms back in 1994, giving a start to the country's energy sector. At the time, the ACG project received support not only from Western energy companies, but also of the US government and other Western states, as they hoped future reserves would make it a viable alternative to Moscow's oil and gas. The hopes were dispelled when it became apparent that no new large reserves would be found.

Right now, Britain's BP controls the biggest share in the ACG - 30.4%. Azerbaijan controls its share via Socar, which owns 25% in the joint venture. ACG is the biggest oil field in the country, generating some 600,000 barrels per day, which amounts to ¾ of the country's crude oil production.

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Posted By : Joykumar Irom on Mon, 10 Dec 2018
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