CEO: Canada’s Zenith to start drilling oper­a­tion in Azer­bai­jan in 2018

Azer News - - Nation - By Trend

The drilling oper­a­tion of Canada’s Zenith En­ergy Ltd at Azer­bai­jani oil fields will start in 2018, said CEO An­drea Cat­ta­neo.

Azer­bai­jan’s Mu­rad­khanli, Ja­farli and Zardab oil fields are con­trolled and op­er­ated by Zenith Aran, Zenith En­ergy’s wholly owned sub­sidiary in the coun­try.

"We have been op­er­at­ing in Azer­bai­jan only a lit­tle more than six months.We are ful­fill­ing all of our com­mit­ments to de­velop this ac­tiv­ity in the coun­try," he told Trend. "The com­pany will bring one of the big­gest rigs from China for on­shore drilling ac­tiv­i­ties here. We will have this rig be­fore the end of 2017 and will start the drilling oper­a­tion in 2018."

Zenith En­ergy be­lieves that with drilling of a va­ri­ety of new wells and re­lated ac­tiv­i­ties such as seis­mic ex­plo­ration and tech­nol­ogy de­vel­op­ment, the Mu­rad­khanli field, which is the big­gest on­shore oil­field in Azer­bai­jan, will prove very prof­itable.

"We are cre­at­ing an overseas team that brings in­no­va­tive ideas from abroad, as well as tech­nolo­gies from Canada. We are there­fore con­fi­dent to show the re­sults achieved by our in­put of tech­no­log­i­cal de­vel­op­ment in the next two or three years," he added.

Cat­ta­neo noted that the Com­pany’s oper­a­tion in Azer­bai­jan’s oil pro­duc­tion arena has only just be­gun and will in­clude some in­no­va­tion.

"We made the first workover in the last 45 days, which hasn’t been fin­ished yet. The re­sults of the first oper­a­tion will be an­nounced in few days," he added.

The CEO re­called that the com­pany has two teams car­ry­ing out the workover oper­a­tion at Azer­bai­jani oil fields.

"We will grad­u­ally ac­cel­er­ate our workover ac­tiv­i­ties and carry out a sys­tem­atic num­ber of workover op­er­a­tions that will achieve a sig­nif­i­cant in­crease in oil pro­duc­tion. We are also in an im­por­tant phase in our negotiations to ac­quire a new drilling rig from China. This will be a game changer in many ways and al­low the Com­pany to achieve more size­able and im­me­di­ate in­creases in oil pro­duc­tion" added Cat­ta­neo.

Re­gard­ing the fu­ture ac­tiv­i­ties of Zenith En­ergy in Azer­bai­jan, the CEO noted that the Com­pany’s am­bi­tion is to ex­pand the scope of its pres­ence in the Coun­try.

"If there is an op­por­tu­nity, we will be very happy to ex­pand our ac­tiv­i­ties in Azer­bai­jan. But first, we have to demon­strate to Azer­bai­jan’s state oil com­pany SOCAR the suc­cess of our meth­ods," he said. "We are very pleased and priv­i­leged in our co­op­er­a­tion with SOCAR and its sup­port is very valu­able to us."

Zenith En­ergy is very op­ti­mistic about the out­come of its ac­tiv­ity in Azer­bai­jan in terms of gain­ing profit, ac­cord­ing to Cat­ta­neo.

Re­gard­ing the im­pact of oil price fluc­tu­a­tions on the com­pany’s ac­tiv­i­ties, the CEO said that Zenith En­ergy has a rep­u­ta­tion to be a low-cost op­er­a­tor.

"So, we are al­ways prof­itable. Even when the oil prices are lower, our profit is guar­an­teed. This al­lows us to look with seren­ity to the fu­ture of our ac­tiv­ity de­spite the oil price fluc­tu­a­tions," he said. "I per­son­ally think that oil prices will in­crease in the next 2-3 years be­cause of the lack of in­vest­ments around the globe in oil and gas ex­plo­ration and de­vel­op­ment."

Speak­ing about staff, Cat­ta­neo said that Zenith Aran cur­rently em­ploys 210 peo­ple and only a few of them (top tech­ni­cians) are for­eign­ers.

"We aim to at­tract young peo­ple from Azer­bai­jan to our com­pany and al­low them to grow and con­trib­ute to the Com­pany’s ex­pan­sion in par­al­lel with their pro­fes­sional de­vel­op­ment. We are very pleased to be in Azer­bai­jan. It is a very pleas­ant place to stay. Baku is a very lovely city. There is a very good cli­mate, very good se­cu­rity at night and dur­ing the day" added Cat­ta­neo.

Azer­bai­jan’s state oil com­pany SOCAR and Zenith Aran Oil Com­pany signed a Re­ha­bil­i­ta­tion, Ex­plo­ration, De­vel­op­ment and Pro­duc­tion Shar­ing Agree­ment (REDPSA) in March 2016 for a block that in­cludes the Mu­rad­khanli, Ja­farli and Zardab oil­fields. These fields cover an area of 642.2 square kilo­me­ters. Pro­duc­tion un­der the Zenith ban­ner be­gan Au­gust 11, 2016.

Zenith holds an 80 per­cent par­tic­i­pat­ing in­ter­est in the three fields within the con­tract area – Mu­rad­khanli, Ja­farli and Zardab – while a SOCAR Oil af­fil­i­ate com­pany (fully owned by SOCAR) re­tains the re­main­ing 20 per­cent. The du­ra­tion of the agree­ment is 25 years, with a po­ten­tial ex­ten­sion of 5 ad­di­tional years.

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