Azerbaijan’s Milli Majlis (National Assembly) will discuss a draft law on the approval and authorization of the implementation of the “Agreement on the exploration, development and production sharing for the area covering parts of the Quba, Qusar, Shabran, Siyazan and Khizi districts (Quba-Caspian)” between the State Oil Company of the Republic of Azerbaijan (SOCAR), Gran Tierra Energy (Azerbaijan) GmbH and SOCAR Quba-Caspian LLC.
Operative Information Center-OMM reports that the document has been included on the agenda of a meeting of the parliamentary Committee on International Relations and Interparliamentary Ties scheduled for September 14.
The agreement was signed on February 19 this year. It was signed by SOCAR President Rovshan Najaf and Gary Guidry, president and chief executive officer of Gran Tierra Energy Inc.
Under the agreement, Gran Tierra Energy Inc., which will serve as the project operator, will hold a 65% participating interest. The geological exploration program includes the collection of gravimetric data, 3D seismic surveys and the drilling of exploration wells aimed at identifying the hydrocarbon potential of the contract area.
The agreement will enter into force after its ratification by the Milli Majlis.
Production-sharing agreements are commonly used in the oil and gas sector to define the rights and obligations of the state and participating companies during exploration and production. They also establish procedures for cost recovery, production sharing and project management.
