Delivery of first gas via TANAP important in realization of SGC - SOCAR head

Baku, Azerbaijan, July 2

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The Shah Deniz consortium, comprised of BP (operator), Azerbaijan's state oil company SOCAR, TPAO, PETRONAS, LUKOIL, NICO and SGC, has announced commencement of commercial gas deliveries to Turkey from the Shah Deniz 2 development project, BP and SOCAR companies said in a joint statement July 2.

The Shah Deniz 2 project is being delivered safely, on schedule and within budget, starting deliveries to Turkey as planned on June 30, 2018.

Shah Deniz 2 is the starting point of the new Southern Gas Corridor, which will deliver Caspian resources directly to European gas markets for the first time. At plateau, the project is expected to add 16 billion cubic meters of gas per year (bcma) to the existing production. Total production from the Shah Deniz field will be up to 26 bcma of gas and up to 120,000 barrels of condensate a day.

Shah Deniz 2 of Azerbaijan represents the first subsea field development in the Caspian Sea - the largest subsea infrastructure which BP operates in the world.

With an investment of approximately $28 billion, the project is comprised of a planned total of at least 26 subsea wells; two bridge-linked platforms; 500km of subsea pipelines and flowlines; major expansion at the Sangachal Terminal near Baku and an expansion of the South Caucasus Pipeline that includes 428 km of new pipeline through Azerbaijan, 59 km of new pipeline and two new compressor stations in Georgia.

“The delivery of first commercial gas via TANAP marks an important milestone in the realization of the Southern Gas Corridor,” SOCAR’s president, Rovnag Abdullayev said. “Notwithstanding the complexity of this mega scale project, we managed to simultaneously coordinate and launch the Southern Gas Corridor segments in Azerbaijan, Georgia and Turkey on schedule and under budget. The construction of the Shah Deniz 2 platforms – both topside units and jackets, fully in Azerbaijan by SOCAR’s affiliate companies is a great track record not only for Azerbaijan but also for the whole region.”

“First commercial gas to Turkey in 2018 is a significant target we had promised to deliver since the start of this major project,” Gary Jones, BP’s regional president for Azerbaijan, Georgia and Turkey, said.

“Working together with the regional governments and our co-venturers in the Shah Deniz consortium, we have met this target safely, on schedule and within budget. This demonstrates that together we can successfully deliver high quality projects. BP as operator is very pleased that the longstanding partnerships we have in Azerbaijan and the entire region have allowed us to bring this world class project to success enabling us to meet our commitments to consumers in Turkey. We look forward to continuing to build on this extraordinary delivery and work closely with the government of Azerbaijan, SOCAR and other co-venturers towards our next target of gas to Europe in 2020.”

A ceremony to launch Phase 0 of TANAP took place June 12 in the Turkish city of Eskisehir.

TANAP, together with Trans-Adriatic Pipeline (TAP), is a part of the Southern Gas Corridor, which provides for the transportation of gas from the Azerbaijani field Shah Deniz to Europe.

The initial capacity of TANAP is expected to be 16 billion cubic meters of gas per year. About six billion cubic meters will be supplied to Turkey, and the rest to Europe. After completion of the TAP, the gas will reach Europe in early 2020.

The share distribution in TANAP is as follows: Southern Gas Corridor CJSC - 51 percent, SOCAR Turkey Enerji - 7 percent, Botas - 30 percent, and BP - 12 percent.

The launching ceremony of the first stage of the Southern Gas Corridor project was held in Baku on May 29.

The gas from the Azerbaijani Shah Deniz field has already gone through the first segment of the Southern Gas Corridor - from the Sangachal terminal to the expanded South Caucasus Pipeline.

The Southern Gas Corridor, which costs more than $40 billion, is one of the priority projects for the EU and provides for the transportation of 10 billion cubic meters of Azerbaijani gas from the Caspian region through Georgia and Turkey to Europe.