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Part of contract work within Shah Deniz-2 can be accelerated

Business Materials 19 December 2014 16:25 (UTC +04:00)

Baku, Azerbaijan, Dec.19

By Emil Ismayilov - Trend:

Construction of the upper modules for the two platforms, the creation of which is carried out within the framework of the second stage development of Shah Deniz gas condensate field in the Azerbaijani sector of the Caspian Sea, may be completed in late 2016 - early 2017, a source on the oil and gas market of Azerbaijan told Trend Dec.18.

Construction of the upper modules for the platforms is carried out by AMEC-Tekfen-Azfen (ATA) consortium, which completed the establishment of upper modules of West Chirag platform in 2013, established within the project for increasing oil production on the block of Azeri-Chirag-Guneshli offshore fields in the Azerbaijani sector of the Caspian Sea.

It was earlier reported that works on the construction of the upper modules for the two platforms under the Shah Deniz-2 were scheduled to be completed in summer 2017.

"All the work began ahead of schedule and is now conducted in accordance with the schedule," said the source. "Work for the production of the necessary parts and assembling of the constructions is conducted in parallel. Dispatch of the upper modules to the sea is expected in 2017."

In general, after completion of construction and testing, the process of delivery, installation and commissioning work of the upper platform modules will be completed in 2018, the source said.

The work on the expansion of ATA production units, which envisaged the construction of new plants and the expansion of the existing ones, the establishment of additional generating capacity and other work, has been completely finished, the source said.

Earlier the development operator of Shah Deniz project- BP announced the signing of a contract with the ATA consortium totalling $974 million within the Shah Deniz-2 project.

Under the contract within five years it is envisaged there will be construction to the upper modules of the production and technological platforms including a residential unit. The contractor is responsible for implementation of all these procedures before commissioning.

The final investment decision was made on the second phase of the Azerbaijani Shah Deniz offshore gas and condensate field's development on December 17, 2013.

The gas to be produced within the second phase of the field's development will be exported to Turkey and to European markets by means of expanding the South Caucasus Pipeline and construction of the Trans-Anatolian Gas Pipeline (TANAP) and the Trans-Adriatic Pipeline (TAP).

Under the project, Shah Deniz gas annual production will increase from 9 billion cubic meters in the first phase of an additional 16 billion cubic meters in the second phase.

Shah Deniz reserves are estimated at 1.2 trillion cubic meters of gas. The contract to develop the offshore Shah Deniz field was signed on June 4, 1996.

Participants at the development of the Shah Deniz field are SOCAR (the State Oil Company of Azerbaijan) with a share of 16.7 percent, BP (28.8 percent), Norway's Statoil (15.5 percent), Iran's NICO (10 percent), French Total (10 percent), Russia's Lukoil (10 percent) and Turkish TPAO (9 percent). Earlier, Total sold its share to Turkish TPAO and after completion of the transaction, the share of the latter will be 19 percent in the project.

Moreover, Norway's Statoil has sold its 15.5-percent share in the Shah Deniz project to the Malaysian oil and gas company Petronas. The transactions on the sale and purchase of the shares haven't been completed yet.

Edited by CN

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