Overview of Umid-Babek Deep Appraisal Drilling

The operator of Azerbaijan's Umid-Babek offshore gas project, Umid-Babek Operating Company (Uboc), has completed the initial phase of drilling a first deep appraisal well at the Umid field in the Caspian Sea. The well, spudded from the jack-up drilling rig Neptune at the southern flank of Umid, reached a depth of 6,972 meters in April, with drilling having started in November of the previous year. This effort is part of a broader initiative by international and local operators to identify new offshore gas reserves, supporting Azerbaijan's long-term goal of doubling gas exports to Europe to 20 billion cubic meters per annum.

Context and Strategic Importance

The deep well adds to several others drilled in the Caspian Sea, including at the BP-led Azeri–Chirag–Guneshli and Shah Deniz fields, as well as the TotalEnergies-operated Absheron field. Most of Azerbaijan's onshore oil and gas has already been extracted over the past century, making offshore exploration critical for future production. The Umid field, along with the adjacent Babek field, is expected to contain the Caspian Sea's second largest recoverable gas reserves, behind only the Shah Deniz deposit, which has estimated reserves of about 1 trillion cubic meters.

Next Phases of Drilling and Development

In the next phase, Neptune will spud a sidetrack with a horizontal section from the existing hole to prepare the well for commercial production once gas offtake infrastructure is built. The completion of this sidetrack is expected to take several months, after which Neptune will move to the northern flank of the Umid field to drill a similar deep appraisal well, also followed by a sidetrack. Uboc will use data from these appraisal wells to finalize development schemes for both flanks of the field. Once the appraisal wells are completed and development plans are finalized, the operator will deploy Neptune to spud additional development wells at both locations. Uboc has extended the charter contract for Neptune with its current Azeri operator, Caspian Oilfield Services, until the end of 2027.

Reserves and Ownership Structure

According to Nobel Upstream, Umid's proved and probable reserves are estimated at 3.5 trillion cubic feet of gas and about 100 million barrels of condensate. Socar holds an 80% stake in the Umid-Babek development, with the remaining 20% owned by UK-based private company Nobel Upstream.