BP expects Azerbaijan oil talks to resume soon

BRITISH Petroleum said yesterday that talks to develop three big oil fields in Azerbaijan had been suspended due to political turmoil in the republic.

The move was prompted by the sudden recall home of a Azeri team from London, where they were negotiating with a consortium of eight Western oil companies.

BP, which has the biggest Western involvement in the projects, said it was optimistic the talks would resume shortly once the political situation in Azerbaijan settled down.

'The talks have only been suspended and the delegation have gone back to Baku to report to the new government,' a spokesman said.

The consortium is understood to have paid about dollars 70m to the Azeri government in return for rights to bid for the projects. The money is thought to be held in an escrow account in a Western bank.

The venture, with an estimated total cost of dollars 12bn, involves the development of the Azeri, Chirag and Guneshi fields in the Caspian Sea.

They were initially to be developed separately but the plans were updated recently and they are to be considered as a single prospect.

Other members of the consortium include Amoco, McDermott International, Unocal, Pennzoil and Ramco, the small UK drilling services provider.

Although BP shares were unaffected by the turmoil, Ramco crashed 31p to 125p yesterday.