Author: Saida G. Gafarova

Abstract:

An integral part of any field development project is assessing its economic efficiency. The article aims at drafting proposals for further enhancement of the efficiency of oil field development in the Republic of Azerbaijan and rationalization of the use of hydrocarbon reserves on the basis of implementation of innovative technologies and modern methods for managing the country’s oil and natural gas complex. The author considers a range of approaches to economic evaluation of oil field development projects and ways to optimize some of its elements. It is suggested to choose the optimal option of oil or oil and gas field development using the comparative analysis of costs. In this instance, particular attention is given to the methods oriented towards identification of the most economically effective directions for development of the country’s oil and gas industry that draw on the experience of other oil-producing countries in terms of application of innovative technologies, assessment of their efficiency, state support of scientific and technical progress etc. The paper gives methodological recommendations on economic justification of intensification of oil extraction and retention of the volumes during oil field development as a way to manage investments in the course of a multi-step process of calculation, evaluation and management of costs, factors and assessment criteria.

Keywords: oil field; efficiency criterion; oil recovery; minimum of the reduced costs; production function; field development.