British oil major BP has agreed to divest a stake of 25% in the Shallow Water Absheron Peninsula (SWAP) exploration project offshore Azerbaijan to Russian firm Lukoil.

BP will continue to serve as operator with a 25% stake in the SWAP production sharing agreement (PSA) during the exploration period. Azerbaijan’s state-owned oil and gas company Socar owns a 50% stake in the project.

The SWAP PSA was signed in December 2014 between BP and SOCAR to jointly explore for and develop potential prospects in the shallow water area around the Absheron peninsula in the Azerbaijan sector of the Caspian Sea.

The SWAP contract area stretches along the Caspian basin margins to the south of the Absheron peninsula.

BP Azerbaijan, Georgia and Turkey regional president Gary Jones said: “We are pleased to welcome LUKOIL to the SWAP partnership, building on our successful relationship in the Shah Deniz project.”

PJSC Lukoil president Vagit Alekperov said: “Lukoil’s joining of the project of BP and SOCAR falls in line with both Russia’s and Azerbaijan’s national interests related to the evolvement of international cooperation in energy domain.”

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By GlobalData

The deal, which is subject to approval from the Government of Azerbaijan, is scheduled for completion in the fourth quarter of 2021.

Following the completion of 3D seismic acquisition programme in the area in 2016, BP defined three prospective areas, North Khali, Bibi-Heybat East and Garabatdag in water depths of up to 40m.

BP spudded the first exploration well in the North Khali prospective area in August 2021 with the drilling slated for completion in the fourth quarter of this year.

Upon drilling the well to a total depth of up to 2,424m, the data from the well will then be analysed.

Based on successful analysis, an evaluation programme would be carried out to confirm the results.