Shah Deniz South Caspian Sea, Azerbaijan

The Shah Deniz oil field lies between Mobil's Oquz, Chevron's Asheron and Exxon's Nakhchiuan fields. Its name can be translated as 'King's Sea'.

The prospect is situated in the South Caspian Sea, off the Azerbaijan shore, approximately 70km south-east of Baku. It lies in water depths ranging from 50m in the north-west, to 600m in the south-east. The contract area covers approximately 860km².

RESERVES

The Shah Deniz structure lies 35km south-east of the Bahar field and 70km south-west of the supergiant Gunashli-Chirag-Azeri oilfield complex. With a vertical relief of over 1.5km (1 mile), the mapped structure encloses an area in excess of 300km². The main reservoir rocks within the structure are expected to be at a total depth of 5km to 6.5km and they have been folded into a relatively simple dip-closed anticline structure.

Reserve estimates have been calculated at between 1.5 to 3 billion barrels of oil (250 to 500 million tonnes) and 50 to 100 billion m³ of gas. Development of the reserves at depths of 600m have been made using technology originally developed for the northern North Sea and the Gulf of Mexico.

SEISMIC

In the summer of 1997, over 22,000km of modern 3D seismic data was acquired about the Shah Deniz PSA contract area, by the Azerbaijan seismic company, Caspian Geophysical. After the data had been acquired using their ship, the MN Baki, Caspian Geophysical processed it in their centre in Baku.

SUBSURFACE GEOLOGY

Immediately prior to the 3D data acquisition, additional data was compiled, concerning the water depth and the near-surface conditions over Shah Deniz. This detailed bathymetry provided information on the faults associated with mud diapir collapse, shallow gas, debris flows 1,000m below the seabed and modern-day features such as mud volcanoes and seabed channels. In total, 12 separate mud volcanoes have been identified. The largest of these, north of the reservoir, produces a major debris flow over 5km wide.

EXPLORATION

The three-year exploration programme for Shah Deniz is on schedule and all of the significant milestones have been achieved.

DRILLING

Two exploration wells will be drilled to fulfil the drilling obligation of the PSA.

Starting the drilling programme, the well SDX-1 was spudded in July 1998 using the semisubmersible Dada Gorgud. Well SDX-1 is located 70km south of Baku at location E on the north-east flank of the structure, in 135m-deep water. Plans envisage drilling the top hole down to a depth of approximately 2,500m before setting the 13 3/8in casing.

This rig is not capable of drilling the lower sections of the Shah Deniz wells due to limitations with the derrick capacity and the well-control equipment.

SHELF 5

The Shelf 5 rebuild was carried out in the KMNF Shipyard in less than 18 months. This involved the removal of 4,000t of equipment. Water-depth capability was increased from 280m to 700m and the variable deck load was extended to 3,200t; 9.6MW of power and 15,000psi BOP were installed.

FRONT-END STUDIES

In advance of the results of the first well, Shah Deniz is undertaking conceptual engineering studies now, so as to be in a position ready to determine the most economical concept for the production of hydrocarbons. In March 1998, Caspian Resource Development, a joint venture of Amec Process and Energy, Fluor Daniel and JP Kenny, as well as subcontractors Gipromorneftegas and the Caspian Drilling Company (SOCAR/Santa Fe), was awarded a contract for conceptual engineering services.

It is envisaged that the field will be exploited in a phased development, involving shallow-water platforms and subsea systems in deeper waters, tied back to the platforms.

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