Oil exploration is a business, which involves a high degree of risk. So far, nobody has been able to refute this statement. In spite of the massive costs, the high knowledge-intensiveness and the extensive use of advanced technologies, all being employed in the exploration, it is not often that the drilling success factor and the oil recovery ratio exceed the figure of 0.3. As the exploration technologies develop further, the hydrocarbon resources become more scarce, whereas the geological and technical conditions relating to the exploration, drilling and production become increasingly more complex. The probabilistic character, which is pertinent to the evolution of the geological processes, can be well illustrated using, as the example, earthquakes and other geological phenomena that still cannot be predicted, regardless of the large costs involved. In general, the process of hydrocarbon fields formation, alike most of the other geological processes, is of a probabilistic character, and is to be evaluated with a high assumption of uncertainty. Therefore, of any ten wells drilled, only a few turn out to be productive. To this point, let us take a few examples from the book written by A. Perradon, the famous petroleum geologist. The Damman field, first in the Saudi Arabia, was discovered after drilling eight dry wells, which were spud within the same geological structure. The Leduc field in Canada was discovered following the unsuccessful drilling, by Imperial, of over 133 exploration wells; 20 dry wells had to be drilled in the field of Messaud, and the West Siberian oil and gas province was discovered following seven years of unsuccessful exploration activities. Ekofisk, the first commercial oil discovery in the North Sea, was found after the drilling of 200 wells, which were either dry or resulted in gas shows.

It is apparent that, in spite of the fact that exploration technologies are increasingly advancing, drilling still remains the only experimental tool that can be used in order to check any hypothesis or model. In this connection, the density of the drilled well-grid is an important indicator, which can be used in the final assessment of a geological region's perspectiveness. Let us remind the reader that three fourth in the number of wells ever drilled worldwide (around 700,000) falls on the USA. The density of the grid, which shows the number of wells per unit of area, is one well per 10 square meters; this figure is by hundreds times higher than the similar indicator for the world's richest provinces, including the South Caspian basin. In terms of the drilling activities ever performed, our region will remind one of the Gulf of Mexico of about four decades ago. Therefore, the unsupported statements, which appear, from time to time, in newspapers and in other mass media holding that the hydrocarbon resources in the South Caspian basin are not considerable, should not be taken seriously.

On the other hand, the region's high perspectiveness has never raised any doubt with the Azeri scientists and experts. This certainty rests upon many years that have been spent on research activities. Our argumentation is simple, and is clear to any professional:

1. Over 1.4 billion tons of oil has been produced in Azerbaijan and the rest of the Caspian Sea; in addition to that, a number of huge fields was discovered, such as Bibi-Eybat, Balakhany- Sabunchi-Romany, Neft-Dashlary, Azeri-Chirag-Guneshli, and Shah-Deniz.
2. The general geological considerations (such as the large and young sedimentation cover of about 30 km, the high sedimentation speed, wonderful sandy reservoirs of the deltas, high-quality regional source rocks, abundance of the natural hydrocarbon shows and mud volcanoes that are observed through aeronautic, space and geochemical methods both onshore and offshore) prove the high perspectiveness of the region; moreover calculations of the potential initial reserves, which were conducted through independent methodologies, result in at least 20 billion tons of fuel equivalent.

The South Caspian basin has been an object for intensive geological and geophysical studies for more than 100 years. Over this period, the exploration strategies changed many times: Initially, wells were drilled at the locations of natural oil and gas shows; later on, oil exploration was conducted in relatively simple anticlinal structures and in more complex near-fault traps and combined traps; in small volumes, hydrocarbons were also found in non- structural traps. As the reservoir depths increased, the geological conditions became more complex, and the structural plans of the various age complexes became inconsistent, not always did the projected models reflect the geological reality. Over the last years, massive actual material and database stock on the region was accumulated, which was independently analyzed in oil companies and universities, both western and local. The results of these research activities have been reported to, and discussed in, numerous symposia. However, using these presentations one can hardly receive an understanding of the unified model of the basin's development, and of the formation of hydrocarbon systems under various conditions. Most likely, such information is restricted, since it is used as the basis, on which oil companies develop their own long-term s trategies for hydrocarbon explorations in the region. Unfortunately, this reality of the oil business complicates the development and discussion of the base-case geological model. First of all, such a model should take into account the particular points about the region and its uniqueness. It is logical that, during the signing of contracts, the first consideration is normally given to large oil traps in the Pliocene complex, which are located nearby the already known large fields. It is also understandable that during the exploration activities oil companies prefer to use the methodologies that have been well proven in other basins. However, one should not transfer automatically, from one region to another, even the most advanced methodologies without taking into account the geological particulars and the exploration experience of the specific region. When discussing the perspectiveness of hydrocarbon exploration in the South Caspian basin, the participants to such discussions do not take into consideration at all the near-fault traps that are qualitatively different from structural traps, the large class of the non-structural and hydrodynamic traps, the reservoirs of the underlying Paleogene, Miocene and Mesozoic deposits, including the traps in reefs and volcanogenic rocks, etc. According to our viewpoint, this is a major reason for a certain reduction in the hydrocarbon exploration efficiency in the basin. It is well-knows from the oil and gas production history that, at a crucial point of development, only the introduction of new ideas and technologies can ensure an increase in the hydrocarbon exploration efficiency.

Over the last years, research institutes of Azerbaijan's National Academy of Sciences have completed a number of proprietary developments, which, to our mind, are of interest in terms of improving the methodologies for hydrocarbon explorations in the region. These scientific results have been published in well-known scientific journals, and have received international recognition. One of these is related to the development of a new concept, which is dealing with the instability of the Earth's geodynamic evolution. In particular, the concept has proven the existence of common planetary forms of folding, has revealed the mechanisms that govern the formation of vertical faults, and has proven in theory the existence of lateral faults; the concept has also substantiated the tectonic stratification of the lithosphere. In the seismic prospecting, special interest is attached to the mechanisms, along which the kinematical and dynamic parameters of elastic waves change in the arbitrarily intense and nonlinearly deformed anisothropic environments. A range of modern computer software programs has been written, which are dealing with the processing and interpretation of seismic data. There is another scientific development, which is related to the uniqueness of our region.

The South Caspian trough is known to be an oil and gas basin that is anomalous in terms of its structure and development history. A certain range of its specific features has no similarity anywhere else in the world. Within it, there is an ongoing, modern and intensive, redistribution of geological substances, which is conditioned by the loss of stability in the stratification system, as well as by the phase and mechanical instability of the rocks and fluids.

These processes cause short-term dynamic phenomena, such as mud volcano eruptions, shallow-focus earthquakes, as well as horizontal and vertical displacements in individual blocks. All these processes are accompanied by restructuring of structural plans, and by complicated processes, in which younger complexes thrust and overlap the older structures. Partially, these processes take place in real time-scale, and are registered through aerospace, geodesic and geophysical monitoring. Through studying the modern processes dealing with the redistribution of substances and phase transitions, particularly, through evaluating the volumes and speeds of the emitting hard substances, gases, oil and water, through studying the morphology of the structures, for instance, on mud volcanoes and diapirs, and through finding the mechanisms for the formation of the modern hydrocarbon systems, one can, in accordance with the principles of actualism, apply the mechanisms, thus understood, on the paleo-geology of hydrocarbons.

Described below is one result obtained from the application of this methodology.

The actual data analysis indicates that, in the sedimentation cover of the South Caspian basin, regional and local decompaction zones are being formed, which are saturated with hydrocarbons. This point can be well illustrated by the huge volumes of the mud volcano breccias and gases, which are emitted during mud volcano activities. As demonstrated by studies of mud volcano activities and shallow-focus earthquakes, phase transitions in the decompaction zones are accompanied by massive pressure impulses, and by the sub-vertical migration of liquefied breccia mass and gases. The numerous tectonic faults and non-conformities along the columnar clays serve as good barriers and traps during the migration of hydrocarbons. Under this model, the formation of the hydrocarbon source, the migration routes and the accumulation zones will take place at the same time, which cannot fit within a traditional model. At present, the physical and chemical bases and the algorithm for this process have been developed. These understandings can develop into the theoretical basis of the new model, along which hydrocarbons are generated in the South Caspian basin; the use of this model can enable to further advance the present exploration technologies.

The concepts regarding the phase and mechanical instability of the region's sedimentation rocks, which instability becomes apparent due to the mud volcano eruptions and the shallow-focus earthquakes, has a number of other important aspects. The paragenesis pertinent to mud volcanoes and shallow-focus earthquakes is an interesting mechanism, which required additional understanding; in this case, the points of the mud volcano eruptions and shallow-focus earthquakes are of interest as being zones of extreme hydrocarbon saturation, of the rocks and reservoir fluids. There is also a number of methodological aspects. The physical fields under conditions of the South Caspian trough are characterized by a high degree of instability; they are subject to substantial fluctuation and, correspondingly, they characterize the condition of the geological environment at a given point of time (in a way, being an instant "photographic image ") that will not be always the same as the real situation. The time component can seriously distort the interpretation of the seismic field and other physical fields, and, in the long run, can lead to errors in the selection of the base-case drilling scenarios. There are numerous and well-known examples for the South Caspian and other young basins, in which the seismic models did not coincide with the real geological conditions. Attempts to resolve this difficulty through using 4D technologies, although they deserves attention, will hardly solve the problem owing to the high costs to be involved.

One of the directions that can be taken in order to solve this problem is dealing with the use of information on earthquakes and mud volcano eruptions; this information can be captured periodically, in the form of seismic waves and emitting fluids, by modern geophysical and geochemical monitoring equipment.

The use of such information, for purposes of monitoring the geological environment and a subsequent interpretation of the materials to understand the geological structures, looks very promising.

Considerable expectations dealing with the increase of the hydrocarbon exploration efficiency can be related to the large-scale use of geochemical and hydrochemical methods. Their present share in the overall volume of exploration methods is unjustifiably low. The chemical transformation processes in sedimentation rocks, and the related mass transfers and phase transitions, become especially apparent in the geochemical and hydrochemical indicators. For these purposes, the most promising studies would be those dealing with the concentration areas of hydrocarbons, helium, argon, tritium, and other components.

In conclusion, let us point your attention to one more point. Regardless of the extent, to which technologies can be advanced, it is the expert who has to take the final decision on any issue. As for their nature, geosciences are regional, and no modern technology will ever be able to replace the experience and knowledge of local experts. Unfortunately, in spite of the statements dealing with cooperation, the use of the knowledge and experience of the local experts is very far from being satisfactory. The considerable advantages in terms of new equipment and technologies level has formed some kind of technological flag-waving in the minds of foreign managers. As the passed years clearly demonstrate, if one is working in a high-risk business, to which the oil and gas business belongs undoubtedly, only the application of the harmonic combination consisting of the latest technology, expert knowledge and intuition can bring the desired success.

Presently, a new oil boom is gaining momentum in Azerbaijan. The discovery and development of huge oil, gas and condensate fields, along with the solution of the transportation and market issues, is to ensure a reliable development of the oil and gas production in Azerbaijan for decades.The pace of this development depends directly on the application of new ideas and technologies, as well as on the enterprise and decisiveness of the oil business management.