Throughout the nineties Azerbaijan which boasts in its cultural heritage the most ancient petroleum production, put itself at the forefront of Caspian offshore oil and gas development by signing a series of production sharing agreements that involve a very wide range of state and private international oil and gas companies. This has been rewarded with major exploration and development successes at the giant Azeri Chiraq Guneshli oil field (which will produce upto 1.2 million barrels per day by 2010 -700.000 per day currently) and the Shah Deniz off shore gas field.
Depending on the outcome of subsequent development and domestic demand trends, these developments mean that Azerbaijan may export up to 15 bcm per year in 2015. Not all prospects have led to production, due to disappointing exploration results and the inability to move forward with exploration and production work in certain fields, where ownership rights are contested by other Caspian states. South Caspian States may well follow the example set by their North Caspian neighbours to come to agreement on these outstanding issues. This may lead to a more operational approach in the South Caspian, including the joint development of subsoil acreage.
With regard to international energy sector governance, Azerbaijan is a member of the Energy Charter Treaty and the Extractive Industries Transparency Initiative which set important international standards in rule of law and for revenue management respectively. Azerbaijan is an observer country seeking to become full member of the World Trade Organisation that also sets standards in energy sector commerce.
See also the Russian website.
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