INPEX Corp said its Chirag oil project in the Caspian Sea has been approved by Azerbaijan's government.
The company said it will now start developing the $6bn project with the first crude oil from the platforms due in 2013.
The project is expected to increase oil production and recovery from the Azeri-Chirag-Guneshli (ACG) field through a new offshore facility located between the existing Deepwater Gunashli and Chirag-1 platforms.
The project is estimated to allow for the recovery of an additional 360 million barrels from the ACG oilfields.
Azerbaijan says it expects to produce 55 million tonnes of crude oil in 2010.
The Chirag oil project is part of the ongoing development of the ACG field in the Azerbaijan sector of the Caspian Sea.
BP, Chevron, SOCAR, INPEX, Statoil, ExxonMobil, TPAO, Devon, ITOCHU and Hess are the partners in the ACG project.