July 7, 1997 - LUKOIL and the State Oil Company of the Azerbaijani Republic (SOCAR) signed an agreement in Moscow on July 3 on the prospecting for oil and production-sharing development of the Azerbaijani D222 structure in the Caspian Sea.

The estimated recoverable oil reserves of the field total 50 million tonnes. LUKOIL has 60% of the project and SOCAR has the remaining 40%. The two companies will jointly carry out seismic tests and drill exploratory wells. "Successful prospecting in that area will be evidence of promising oil reserves in the northern part of the Caspian Sea," LUKOIL Vice President Vitaly Lesnichy said.

Oil from that field will be pumped through the nearby Baku-Tikhoretsk-Novorossiisk pipeline, making the project very efficient for the two oil companies. Russia will have oil pumped across its territory and numerous Russian enterprises will be involved in supplies of materials and equipment for the project and contractual work for it.

Nearly $2 billion will have to be invested in the project.

The signing ceremony was attended by Azerbaijani President Heydar Aliyev and Russian President Boris Yeltsin.

"This is another major step towards the consolidation of cooperation between our countries as well as our companies. LUKOIL will do its best to justify the trust placed in us again and continue to efficiently carry out our projects in the Azerbaijani Republic," LUKOIL President Vagit Alekperov said.

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