The Oil Resources of Azerbaijan: Survey and Current Developments

Azerbaijan, the third-ranking oil-producing former Soviet republic, produced 10.3 million tons of crude in 1993. Output, although slowly dwindling since 1966 as major onshore deposits have been depleted, now accounts for roughly 2.5% of former Soviet production. Reserves, estimated by various sources as ranging from 137 to 960 million tons, have been the focus of considerable interest by Western oil companies, as the government of Azerbaijan has sought foreign expertise and equipment in the development of promising offshore fields in deeper waters of the Caspian Sea. This paper describes the geologic structure of Azerbaijan's major oil- and gas-bearing regions (Caspian-Kuban, Kura, and Apsheron-Balkhan) and outlines the development history of major fields. Major onshore deposits on the Apsheron Peninsula, which yielded over half the world's petroleum in 1900, have now been largely exhausted, with production and exploration activity shifting to offshore deposits along the Apsheron Sill, an anticlinal structure extending from the Peninsula across the Caspian into western Turk- menistan. A prolonged process of negotiations between Western companies and the Azerbaijan government over the rights to explore and develop particular fields is summarized and the status of plans to construct an export pipeline to service outside markets is discussed.