Equinor Completes Full Divestment of Oil Assets in Azerbaijan
Posted 22/12/2023 14:55
Norwegian energy industry giant Equinor has finalized an agreement with the State Oil Company of Azerbaijan Republic (SOCAR) to divest all its remaining assets in Azerbaijan. The divestment includes a 7.27% non-operated interest in the Azeri Chirag Gunashli (ACG) oil fields located in the Caspian Sea's Azerbaijan sector, an 8.71% interest in the Baku-Tbilisi-Ceyhan (BTC) pipeline, and a 50% stake in the Karabagh field.
Equinor has been present in Azerbaijan since 1992, and the ACG oil fields, operated by BP, constitute the largest oilfield in the Azerbaijan sector of the Caspian basin. The BTC pipeline is a crucial infrastructure used to transport crude oil to the Turkish Mediterranean coast.
The State Oil Company of Azerbaijan Republic (SOCAR) already holds a 25.0% stake in ACG, a 25.0% stake in BTC through Azerbaijan BTC Limited, and a 50% interest in the Karabagh field. With this agreement, SOCAR consolidates its position in these strategic assets.
Philippe Mathieu, Equinor's Executive Vice President for International Exploration and Production, commented on the transaction, stating, “Together with SOCAR and the other partners in ACG, we have created significant value for the partnership and for the Azerbaijani society. SOCAR is well positioned to create further value from the assets for the longer-term, and we have appreciated the close collaboration over the years.”
Equinor is currently in the process of reshaping its international oil and gas business, and the divestment in Azerbaijan aligns with the company’s strategy to focus its international portfolio. The closing of the transaction is contingent upon meeting specific conditions, including regulatory and contractual approvals.
In addition to the asset divestment, Equinor and SOCAR have signed a Memorandum of Understanding (MoU) to collaborate on sharing experience and best practices in low-carbon solutions, reducing greenhouse gas emissions, and carbon management. This cooperative effort underscores both companies' commitment to sustainable and environmentally responsible practices in the energy sector.