AZERBAIJAN - The Oguz JV.

A 227 sq km offshore block south of Nest Daslari and Guneshli and north of Tagiev, Oguz was originally said to contain 290m barrels of oil and 685 BCF of gas, with the JV held 50-50 by ExxonMobil and Socar. But ExxonMobil in mid-2001 decided to abandon the block after its first well was stopped with "no commercial hydrocarbons".

This block had been taken up by Mobil in 1997. During the Soviet era two wells were drilled and both proved water-wet. Mobil paid a $10m signature bonus and agreed to a $10m production bonus and an incremental reserves bonus of $2.5m per 100m barrels. Exxon acquired Mobil in 1999/00.

In June 1998, Mobil was invited by Turkmenistan to negotiate the Serdar field, which was hotly disputed by Azerbaijan where it is called Kyapaz. Mobil then said it would not begin work until the two states reached an agreement over its ownership.

ExxonMobil withdrew from the Zafar-Mashal and Nakhichevan JVs in 2005. The Zafar-Mashal block lies in deep water about 110 km south-east of Baku and south of the Bahar and Shah Deniz gas/condensate fields. The PSA, signed in April 1999 in Washington by President Aliyev and Exxon, was held 30% by ExxonMobil, 20% by ConocoPhillips and 50% by Socar. The offshore Nakhichevan block was awarded in August 1997 on the basis of a 50-50 JV between ExxonMobil and Socar. Socar in May 2005 confirmed that operations on the 280 sq km-Nakhichevan licence were being wound up and that ExxonMobil was offering the state $27m compensation (see the background in Vol. 63, Gas Market Trends 1).