After the discovery of oil fields, Baku became a special place, where various economic and political interests of international coalitions, industrial clans and leaders were concentrated and clashed. VK begins publishing chapters from the book by Ismail Agakishiev "History of the Baku Oil Industry and the Second Oil Boom (second half of the 19th century - beginning of the 20thcentury)" The book presents a historical analysis of the emergence and current state of the Azerbaijani oil industry.
By June 1994 certain positive dynamics was achieved in the negotiations with a group fo foreign companies that allowed Heydar Aliyev to hope “that the negotiations would be finished in the near future”. The main outcome fo the two meetings in Baku was the creation of the contract model. Out of the 46 questions discussed during two weeks, the sides agreed on 36 and the program for the exploitation of the Azeri and Chirag deposits was created. The agreement was also reached on the employment of local specialists, the reconstruction of the Chirag platform to transport the crude oil using the oil pipe Baku-Grozny-Novorossiysk. The negotiations continued in Istanbul. The working group of SOCAR headed by its president Natik Aliyev went there on June 6, 1994. The new round of the negotiations was supposed to last until June, 20.
The president of Delta Oil noted that the main interest of his company was “to participate in the development of the oil sector in the brotherly Muslim country”. It first the tender for the development of the Azeri deposit was sent to 16 coutnries, but only six foreign companies – Unocal (USA), McDermott (USA), British Petroleum (UK), Statoil (Norway) and TPAO (Turkey) – got interested in it. Later the development of Chirag and Gyuneshli was added to the contract. The negotiations lasted for three years.
Vice-president of SOCAR Ilham Aliyev insisted on the cooperation with Russian companies, saying that “they can work in the Azerbaijani sector of the Caspian similar to the Americans and the British”. Russia was against the inclusion of Gyuneshli in the contract. During the hist visit to London, Heydar Aliyev mentioned the participation of the Russian Lukoil in the development of Azeri and Gyuneshli. The negotiations about the inclusion of Lukoil in the contract went from September 1993, and on November 20, 1993 the documents about the cooperation with Lukoil and SOCAR was signed bringing Russia the part of 10%. In May 1994 the joint project Azeri-Lukoil was created to involve Russian company in already finishing process of negotiating the contract.
Russian company joined the work of the consortium on June 6. The involvement of Lukoil allowed Azerbaijan to bring Gyuneshli back to the objects of discussions. Later the economic character of relations with Lukoil started to prevail over the political one. This country became a partner of SOCAR similar to BP or Amoco. The oil reserves of Azeri and Chirag were estimated in 1994 at 454 millions tons. According to the option that was discussed by the team of Natik aliyev, 210 million tons belonged to Azerbaija meaning 75% of all the contract profit. The most profitable part for the republic was the development of deep-water part of Gyuneshli with the oil reserves of 50 million tons, out of which 43 million should go to Azerbaijan, meaning 80% of the entire profit of the Gyuneshli contract. Due to this the income of the country should increase considerably: if the extraction from the two oilfields was planned at 106 million tons in 15 years, with the inclusion of Gyuneshli the volume increased to 128 million tons. TPAO was the other member of the consortium. This Turkish state company appeared in 1985 but due to the limited carbohydrates resources in Turkey it mostly worked abroad. Its international activity started in 1992. Azerbaijan was the first country where it got involved in the large oil project.
The main task of the consortium of 11 companies was the financial, managerial and high-level technology support of the contract to extract the Azerbaijani oil and bring it to the world markets. On September 14, 1994, before the signing “the contract of the century” Heydar Aliyev signed the decree no 206 about the results of the negotiations on the joint development of the oil deposits in the Azerbaijani sector of the Caspian together with the foreign oil companies.
