BP wins right to explore Azeri fields

BRITISH Petroleum, the oil group, has made its first significant breakthrough in the former Soviet Union with a dollars 40m ( pounds 20m) oil exploration deal with Azerbaijan, writes Neil Thapar.

The company, in conjunction with Statoil, the Norwegian state oil company, has been awarded the exclusive right to carry out a feasibility study into Dostlug and Shak Deniz, two fields in the Caspian Sea.

Dostlug contains at least one billion barrels of recoverable oil; the other has yet to be evaluated.

In addition to the right to assess the fields' potential, the deal enables the partners to negotiate production-sharing arrangements.

BP's exploration arm will lead the evaluation work and own about one-third of the venture. The Azeri government will own half and Statoil the balance.

The companies already have a 19 per cent interest in the Azeri field, where Amoco, the US company, is leading a study.

BP is selling a Croydon-based foams business to its management for pounds 20m. The buyout is backed by 3i and Prudential Ventures.