MOL Group and Azerbaijan's state-owned Socar have signed a binding joint venture agreement for an onshore exploration project in Azerbaijan's Shamakhi-Gobustan region. The comprehensive agreement covers exploration, development, and production sharing.

Agreement Structure and Strategic Importance

Under the terms, MOL Group will hold a 65% operating stake, making it the project operator, while Socar retains a 35% stake. This deal expands MOL's presence in the Caspian region, where it is already a minority shareholder in the major offshore ACG oil field and the BTC pipeline. Azerbaijan is a supplier of oil and gas to Hungary, and the ACG field alone accounted for 14% of MOL's total production and 25% of its reserves as of 2024. The BTC pipeline is crucial for supplying oil to MOL's refineries in Central and Eastern Europe.

Project Details and Exploration Potential

The Shamakhi-Gobustan project represents the first major onshore exploration effort in Azerbaijan since the country's independence in 1991. The area is largely unexplored, characterized by plains, small mountains, and numerous mud volcanoes and oil seeps—surface indicators often associated with hydrocarbon potential. However, its complex geological structure previously hindered exploration attempts dating back to the Soviet era. Commercial discovery chances are therefore difficult to predict.

Next Steps and Recent Appraisal Work

The project's next phase involves a seismic survey scheduled to begin in early 2026, followed by exploration drilling. This follows a recent appraisal program completed by Socar in November, which involved an aerial gravimetry survey covering approximately 5,000 square kilometers. This technique uses aircraft-mounted gravimeters to map subsurface density variations from the air to locate oil, gas, and minerals.