MOL Group and Azerbaijan’s Socar sign binding joint venture agreement
Hungary’s MOL Group has finalised a deal to become a key shareholder and operator at an exploration project onshore Azerbaijan.
The transaction increases MOL’s exposure to the Caspian region, where it is already a minority shareholder in the Azeri-Chirag-Gunashli (ACG) offshore oil development.
Azerbaijan is also a supplier of oil and gas to Hungary.
MOL said in a statement on Wednesday that it signed a comprehensive exploration, development and production sharing agreement with Azeri state oil and gas player Socar for an onshore area in the country’ Shamakhi-Gobustan region.
The Hungarian player will hold a 65% operating stake in the project, with Socar holding the remaining 35%.
“The Shamakhi-Gobustan joint exploration project adds a great opportunity to our international upstream portfolio, and as the operator, we are proud to build on MOL Group’s extensive experience in exploration and production,” said MOL chief executive Zsolt Hernadi.
As part of the project’s next steps, a seismic survey is scheduled to begin in early 2026, followed by exploration drilling, MOL said.
Ilham Shaban, a partner at Baku-based energy consultancy Caspian Barrel, told Upstream that it will be the first major exploration effort onshore Azerbaijan since the country gained independence from the Soviet Union in 1991.
The area has not been explored before — it is just “plains and small mountains” — so chances of commercial discovery are difficult to predict, he said.
MOL entered Azerbaijan in 2020 after acquiring a 9.57% stake in the BP-led ACG project, and an 8.9% stake in the Baku-Tbilisi-Ceyhan (BTC) pipeline that carried crude from Azerbaijan to Turkey’s Mediterranean port of Ceyhan.
ACG represented 14% of MOL’s total production and 25% of total reserves as of 2024, the company said.
The BTC pipeline plays an important role in the supply of oil to MOL Group’s refineries in Central and Eastern Europe, it added.
The Shamakhi-Gobustan region is mostly known for its high number of mud volcanoes and oil seeps on the ground, the presence of which is generally considered in Azerbaijan to indicate good potential for hydrocarbon exploration.
However, the the area’s complex geological structure hindered previous exploration efforts that started during the Soviet era.
The MOL deal follows the completion of a new appraisal programme by Socar in the region earlier in November.
According to Socar, its aerial gravimetry programme covered about 5000 square kilometres in the Shamakhi-Gobustan region.
Aerial gravimetry involves using an aircraft with sensitive gravimeters to measure tiny variations in Earth’s gravity field from the air, mapping subsurface density changes to find oil, gas and minerals.
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