Publication: Monitor Volume: 1 Issue: 131

Azerbaijan is on the verge of signing a new, large-scale oil deal with an international consortium. The contract provides for prospecting and exploiting over a 30-year period the "Karabakh" oilfield, with estimated recoverable deposits of 100 million tons, in Azerbaijan’s portion of the Caspian Sea’s continental shelf. The stakes in the project are tentatively set at 50 percent for LukAgip, a joint venture of Russia’s LukOil and Italy’s Agip; 30 percent for the US company Pennzoil; 7.5 percent for LukOil, 5 percent for Agip, and 7.5 percent for Azerbaijan’s state oil company SOCAR. The deal about to be signed is Azerbaijan’s second-largest after the 1994 "deal of the century" with another, overwhelmingly Western international consortium for three other offshore oilfields. (16)

Oil extraction in Azerbaijan has actually declined in the last few years–a fact that has passed almost unnoticed amid the international oil deals recently signed or projected there. According to latest official figures, the country’s oil output for the first 10 months of 1995 has been 7.7 million tons, down 3.5 percent compared to the same period of last year. The 1994 oil output was 9.6 million tons, down 7 percent compared to 1993. (17) The international contracts should combine in spectacularly reversing that decline within a few short years.

1. NTV, November 7

2. Reuter, November 8

3. Reuter, November 9

4. Interfax, 8 November

5. UPI, November 8

6. Reuter and Interfax, November 8

7. Radio-1, ORT, "Moscow’s Echo" Radio, November 7

8. Russian TV, November 7

9. Interfax, BBC World Service, 8 November

10. Interfax and Itar-Tass, November 8

11. Interfax, November 8; Itar-Tass, November 6

12. Interfax, November 8

13. BNS, November 6

14. Basapress and Flux, November 7 and 8

15. Interfax, November 7 and 8

16. Petroleum Information Agency, November 4

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