Azerbaijani company to develop Israeli oil field

The Azerbaijani state company was able to outrun "Gazprom" and received 5%
of the license on drilling at the only economically-viable oil field in Israel.

The Azerbaijani state-owned Caspian Drilling Company, a subsidiary of the
state-owned SOCAR, will soon begin drilling at the Med Ashdod oil field,
located in the territorial waters of Israel, 16 km from the coast of Ashdod
at a depth of 6000 m, the Israeli Ambassador in Baku, Michael Lotem, told
the IzRus portal
In this project the CDC will be a partner of the Israeli consortium Shemen
Oil & Gas Resources Ltd. According to IzRus, the CDC entered into a
partnership agreement with the SMOG in February 2011. According to an
agreement signed between the parties, the CDC was assigned responsibility
for drilling works and is entitled to 5% of the Med Ashdod license.

As a result of a long process, the state of Israel has reserved the right
to withdraw 5% of the Med Ashdod license from the CDC in view of laws that
could be adopted in the future by the Israeli parliament regarding the
confrontation with Iran.

This agreement has political significance. First, SOCAR is a state-owned
company of a Muslim republic, which borders on Iran and has strong
relations with it. Med Ashdod is located in the area of rocket attacks from
Gaza, which are periodically being launched by Palestinian groups funded by
Iran. At the same time, the agreement concerns the interests of Russia, since the
Kremlin began negotiations with the SMOG on participation in the
development of Med Ashdod in November 2010 on its own initiative.

Currently, about 20-30 percent of oil and petroleum products at the Israeli
market come from Azerbaijan. Oil arrives from Azerbaijan via the Baku -
Tbilisi - Ceyhan oil pipeline. From its final destination point it is
transported by sea to Israel.