ANSAD PETROL IS 10 YEARS OLD
LARGEST AZERBAIJANIAN -TURKISH JV KEEPS GROWING OIL PRODUCTION

Oil had been known in Neftchala since the end of XIX century. First oil pit of 10-12 depth meters hand dug by inhabitants dates back to this time. That welcomed the beginning of exploration works and discovery of new oil fields.1926 saw first industrial oil inflow. This effect was rapidly visible, over many years this field gave 6,0 million tones of oil.In 1993 the State Oil Company of Azerbaijan Republic (SOCAR) and Turkey's "Attila Dogan Petrol" Company have initiated "ANтAD Petrol"Joint Venture on the base of former oil-and gas-related "Neft- chalaneft". The Contract area extended over 2500 square kilometers. The Agreement is 20 years in duration.The area includes production zones Neftchala and Khilly and also exploration areas Babazanan, Khashimkhanly, Azadkend, Nasimikend, Muganly, Middle Muganly and Shorsulu. Company's authorized capital stock amounts to $50,0 mln In 1995 the Malaysia's company "Land and General Berhad" entered the project, contributed 17,15% of "ANтAD Petrol" JV's stake. From the beginning of "ANтAD Petrol" JV's activity there have been carried out a range of works on Neftchala and Khilly regions. Company specialists, involved into this project, studied report compiled on active and inactive wells and drew out company's further activity. As a result many wells and idle equipment and inundated tankers were rehabilitated, special collector equipment of 17 km length has been installed. Having installed the equipment, firstly the region has been drained. As a result the roads leading to building and premises of this region became acceptable. Technologies of prime repair and exploitation works are constantly under modernization. They mainly use equipment and materials in conform to American Petroleum Institute (API). In order to bring works to world accepted standards along with local Azerbaijan companies many foreign companies were involved into the region. As a result new technologies have been brought to Azerbaijan, and local specialists improved skills of their operating. The Joint Venture devised purposed project to convey to close loop system, oil production, shipping, gathering, treatment and sale system. Oil, produced by this system is economically safe. Application of this system was reflected in avoiding loses and environmental and soil pollutions. 23 metallic oil tankers with total capacity 36,000 m3 were put in line, over 20,000 meters of drilling columns were revamped and renovated, and nearly 35 km of new columns were installed. There were built and commissioned field offices, offices for operators, trans-port and special technical premises, stocks, workshops and other entities in conforms to today's standards. "ANтAD Petrol" Joint Venture carried out a great deal to strengthening its financial-technical base. For the time being there are over 70 machines and mechanisms on the Company's balance for which operation has been formed the base for transport and special technique. In order to renovate and built new roads the asphalt plant has been built. For increasing and keeping the production rate the company carries out geological and technological activities on active wells. The Babazanan region faced geophysical surveys. During 1994-1998 realization of these works took $22,5 million. In 1994-1996 "Attila Dogan Petrol" Company was contracted to operate the Joint Venture, but in 1997 this work has been commissioned on SOCAR. Since 1998 the JV persists with its own funds. As realization of these works the company swiftly changed from dropping production level to shift up production rate. There are 155 active wells operating on the area. Daily output averages to 120 tones. In comparison with 1994 the oil output grew 31,4%. From the very beginning of JV's activity by this time the company's total output reached nearly 313,0 thousands tones of oil and 172,3 million m3 of gas.1999 was a year of first oil export. In 2001 oil output totaled 45110 tones of oil, 51,4%of this we have realized as JV's product. Recoverable oil reserves on the production area are estimated to be 9,3 million tones. In 2000 we have drilled 7 wells, 8 wells also have been completed in 2001. Building in 2002 has also completed 6 wells; one is on a stage of mastering. In 2003 we plan to carry out a range of works for increasing oil production. As a result of activity "ANтAD Petrol" Joint Venture along with production problems solved social problems not only JV's personnel and also whole Neftchala region. It should be mentioned that budget of Neftchala region is mainly feed by "ANтAD Petrol" JV. At the time being the company employees are over 740 personnel, in spite of that, in the Agreement there considered 420. Besides, we indirectly create more job vacancies supplying orders to drilling, construction and shipping, field-geophysical enterprises. As a result of "ANтAD Petrol" JV's activity we have obtained an appropriate success in environmental precautions. Draining of bogs created over many years, partial liquidation of open oil storages, repair and renovating of oil pipes and other activities allowed us to solve some ecological problems. In 2003 there were made more expenses on JV's budget for solution of ecological problems. For instance, we consider purifying and injecting the sea polluted field waters. Laboratory surveys have already been carried out and placed orders for special equipment and devices in Turkey. It should be noted, that "ANтAD Petrol" JV also meets of Neftchala region in natural gas. The JV also supplies gas Khilly region. We also finance sport base and region's kindergarten. At present production, accountant is completely computerized. We hope oilmen of Neftchala region and "ANтAD Petrol" JV's personnel keep their customary business practice and will achieve even greater success.