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Azerbaijan Oil
Contracts
The Southwest Gobustan concession
is composed of three distinctly separate areas known as the Northern,
Central and Coastal blocks. The concession extends over approximately
150,000 acres. By reworking existing wells and drilling development
wells, it is anticipated that approximately 20,000 barrels of
oil and 100 million cubic feet of gas per day can be produced
within five years beginning in 1999. 
Its Central and Coastal blocks were discovered between 1949 and 1995. The Northern block was discovered between 1905-1960. Currently, only small amounts of hydrocarbons are being produced from the Coastal block. The Duvanni field situated within the Coastal block is presently the largest onshore gas field in Azerbaijan. Gas production from this concession is expected to be sold into the national domestic grid to help offset recent shortfalls of gas in the Baku area. Oil production will be shipped through one or more of the oil pipelines currently in existence or under development in the region and via rail to Georgia on the Black Sea. The quality of crude found in this region is considered "sweet," meaning it is very low in corrosive chemical compounds. Both foreign companies Union Texas and Commonwealth are new to Azerbaijan. Union Texas Petroleum Holding, Inc. is one of the largest independent producers in the U.S. and is involved in Louisiana, the UK, the North Sea, Indonesia and Venezuela. Union Texas reported gross revenues of $1 billion in 1996. Commonwealth Oil & Gas Company Ltd. (Canada) is a wholly owned subsidiary of A&B Geoscience Corporation (Canada), which is listed on the Vancouver Stock Exchange (ABG.V). The operating company for Southwest Gobustan was Union Texas Gobustan Ltd. with Rich MacDougal, President. It now is Commonwealth.
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Nick
Baxter, Manager