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Abstract Several major international oil companies have now signed or are negotiating for exploration and development agreements with countries of the Former Soviet Union (FSU) for acreage in the highly prospective and land locked Caspian Sea. At the time of signing the first of these agreements there were no Mobile Offshore Drilling Units (MODUs) in the Caspian Sea which met internationally recognized standards of safety and operating efficiency. This paper presents the case history of the of the acquisition of and the $40 million, 12 month project to refurbish the semi-submersible drilling unit "Kaspmorneft" in the Azerbaijani sector of the Caspian Sea. This was the first such acquisition and refurbishment project to be undertaken in the region. The alternate options for accessing a suitable unit are reviewed as are the factors effecting the final selection of the "Kaspmorneft". The paper also reviews the contractual philosophy adopted to charter the vessel and to perform the refurbishment work. The preparation of the scope of work and selection of the refurbishment work site are described. The paper goes on to review the refurbishment project including the preparation of schedule, time and cost estimates, recruitment of expatriate and national staff, award of sub-contracts, logistics, safety management systems, training, preparation of worksite and implementation of the workscope. The paper discusses the problems that were encountered in initiating a project of this nature in a developing FSU country and the measures that were taken to overcome those problems and so see the project through to its successful conclusion.
Introduction The un-developed hydrocarbon reserves lying beneath the Caspian Sea are estimated to be of the order of 12 billion barrels with a further 25 billion barrels yet to be found. The Former Soviet Union countries of Azerbaijan, Kazakhstan, Turkmenistan and Russia, and Iran, surround this land locked body of water (Fig. 1). Following the dissolution of the Soviet Union, several international oil companies began negotiations to participate in the development of the regions hydrocarbon reserves. One of the first agreements to be concluded was the Production Sharing Agreement (PSA) between the Republic of Azerbaijan and a consortium of eleven companies that were the founding members of Azerbaijan International Operating Company (AIOC) (Table 1). The PSA required AIOC to drill a minimum of three appraisal wells on their contract area within 30 months of the agreement being ratified in December 1994.
The depth of the Caspian Sea varies from a few meters in the North Caspian to over 900m in the South Caspian. The water depth in the AIOC area of interest varies between 80m and 300m. Marine vessel access to the Caspian Sea is possible from the Black Sea via the Volga-Don waterway or from the Baltic Sea via the Volga River. The size of vessels that can navigate these waterways is limited in length, beam, height and draft. There are no existing MODU's able to navigate either waterway without significant modification. The indigenous MODU fleet of the Caspian Sea consists of five semi-submersible and six jack-up units. The first of the semisubmersibles was the "Kaspmorneft", a Freide & Goldman designed Pacesetter rig built in modules in Pori, Finland and assembled in Astrakhan, Russia by Rauma Repola in 1980. The four subsequent semi-submersibles were Soviet designed and built "Shelf" Class rigs which were also assembled in Astrakhan. The rigs are all owned and operated by the State Oil Company of the Azerbaijan Republic (SOCAR). The rigs were in a very poor state of repair and required significant investment to bring them to internationally recognized standards of safety and operating efficiency.
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