BP, SOCAR sign MOU for Caspian reserves

BAKU, Azerbaijan, July 14 (UPI) -- BP signed a memorandum of understanding to explore two sectors of the Caspian Sea with the State Oil Co. of the Republic of Azerbaijan.

The MOU concerns the Shafaq and Asiman structures in the Azeri territorial waters of the Caspian Sea, BP announced. Neither has been explored before.

The MOU gives BP the exclusive rights to negotiate production sharing in the structures, located some 78 miles southeast of the Azeri capital, Baku.

The area covers around 425 square miles in the Caspian Sea.

Azerbaijan has emerged as a regional energy giant. Oil production from Azerbaijan could increase by roughly 10 percent to 366 million barrels of oil by the end of 2009, SOCAR says.

Rovnag Abdullayev, the president of SOCAR, said he hopes to raise oil production from $36 billion in investments from oil production contracts.

BP-Azerbaijan, for its part, said production has surpassed 1 billion barrels of the Azeri Light crude blend.