Autumn 1997 (5.3)
Six months after ratification, North Absheron Operating Company (NAOC) is planning its first exploration well in the Dan Ulduzu and Ashrafi prospects. As the 4th multi-billion-dollar consortium contract for oil exploration and development in the Caspian, the partner companies include Amoco, Unocal, Delta Oil, Itochu and SOCAR (State Oil Company of Azerbaijan Republic). The first well will target the Ashrafi structure in waters 170 meters deep in eastern half of the 453 square kilometers contract area, 100 kilometers east of the Absheron Peninsula.
Left: At the Dedication Ceremony. Center, shaking hands, is NAOC President, Tom Klockenbrink. To his left is Azerbaijan's Deputy Prime Minister Izzat Rustamov.
The production sharing agreement calls for the government of Azerbaijan to receive a total of $75 million in bonuses and investments in this consortium, while ultimate expenditures if successful are estimated at $2 billion. The 1997 work program and budget were approved at the first CMC meeting held in late April and is being accomplished as planned. A 1998 work program will be discussed in a late September CMC meeting.
NAOC has expanded to a 25-member staff, working out of the refurbished offices in Baku's old "Inner City." NAOC has hired 19 Azerbaijani staff in full-time positions. Six expatriates from the participating oil companies have moved to Baku permanently and operate in the drilling, geoscience and financial disciplines.
The 3D seismic data that was acquired in March and April has been processed and interpreted. The results have been used to determine the location of the first well, which is set to commence drilling in late October. According to Tom Klockenbrink, President of NAOC, "Project cycle time continues to be reduced significantly through strong support from SOCAR, our other partners and the government of Azerbaijan."
Cultural Humanitarian Project
The shareholder companies in NAOC began work on a refugee housing project in Mingachevir in April 1997. This project uses intermediate technology to provide low cost housing that can be used for alternative purposes when no longer needed by the refugee community.
The housing project was handed over to local authorities in Mingachevir on July 18. Azerbaijani Deputy Prime Minister Izzat Rustamov, NAOC management, and shareholder representatives from Amoco, Unocal, and Itochu attended the dedication ceremony. The $205,000 project was a gift from the NAOC shareholders to the country of Azerbaijan promised at the signing of the Ashrafi-Dan Ulduzu Production Sharing Agreement at Gulistan Palace on December 14, 1996.
MIC Industries and Azerkendtikinti (Azerbaijan Agricultural Construction Company) completed the uniquely designed refugee housing project in less than four months. The project consists of ten structures designed to house a total of 100 families, plus the necessary facilities for a small community (bathhouse, toilets, water sources and a road).
The walls of the buildings are constructed with indigenous limestone blocks and local materials were used for the doors, windows and fixtures. MIC imported special equipment to Azerbaijan in order to produce the roofs from rolls of precoated sheet steel, rather than the more expensive and less durable wood and corrugated metal roofs. The resulting buildings are durable and functional as refugee apartments as well as future multi-purpose buildings for the city of Mingachevir.
At the ceremony, the Deputy Prime Minister turned over keys to the first ten refugee families. The festivities were enhanced by the hope that these shelters, too, would be a temporary residence for these people in their quest to return to their homelands in Nagorno-Karabakh.
The local authorities and the citizens of Mingachevir, a city of 80,000 people before the war, have worked hard and sacrificed to accommodate the 20,000 refugees they have hosted for more than four years. Such housing as provided by this project helps to alleviate the overcrowding of schools and other public buildings that have been used as refugee dwellings. The grateful families invited the representatives of NAOC and its partner companies to visit them one day when they are able to return to their homelands which are currently under military occupation.