The South Caspian Basin encompasses the southern extension of the Caspian Sea, including land areas in eastern Azerbaijan, western Turkmenistan, and northern Iran. The region is endowed with abundant petroleum resources, and oil and gas production has played an important commercial role in the region for more than 150 yr, especially in Azerbaijan and to a lesser extent in Turkmenistan. Major oil reserves are concentrated in 2,500–3,500 m of shallow-marine, deltaic to lacustrine deposits of middle Pliocene age. To date, some 620 oil and gas fields have been discovered in strata ranging in age from Miocene to Quaternary; however, less than a dozen fields produce from both Miocene and Quaternary reservoirs. The principal reserves and targets for future exploration are in the middle Pliocene Productive Series.

The South Caspian Basin is unusual in several respects:

• sediment accumulated at exceptionally high rates (as high as 4.5 km/m.y.);
• sediment accumulation in each of three depocenters was as great as 20 km (5 km of Pliocene sedimentary deposits);
• there was low sediment compaction;
• geothermal gradients are relatively low (1.5°C/100 m); and
• abnormally high pressures exist in some basin areas.

In this depositional environment, good reservoir porosities and permeabilities could be preserved to depths as great as 12 km. Analysis of source rock samples collected from outcrops, cores, and mud-volcano ejecta shows total organic carbon contents to range from 1.2 to more than 10 percent, the richest being in the middle part of the Oligocene–Miocene Maykop Series. Source rocks, with thicknesses ranging from 100 m to more than 2,500 m, form the cores of many anticlines in the basin. Reservoir rocks, consisting of fluviodeltaic clastic deposits ranging in texture from mudstone to conglomerate, are mostly in the middle Pliocene Productive Series, but some Miocene and lower Pliocene reservoirs are also present. Reservoir seals are formed by interbedded shales. Hydrocarbon traps developed mainly during the late Pliocene and early Pleistocene.

The Oligocene–Miocene Maykop/Diatom Total Petroleum System within the South Caspian Basin is separated into five hydrocarbon assessment units:

1. Apsheron-Pribalkhan Zone,
2. Lower Kura Depression and Adjacent Shelf,
3. Gograndag-Okarem Zone,
4. Central Offshore, and
5. Iran Onshore-Nearshore.