SOCAR: Cost of Shah Deniz - 2 project can be adjusted
Azerbaijan, Baku, April 18 /Trend E.Ismayilov/
Preliminary engineering and design work in the second stage of development of Shah Deniz offshore gas condensate field will allow to set the final cost of Shah Deniz-2 project, head of the State Oil Company of Azerbaijan (SOCAR) Rovnag Abdullayev said on Wednesday.
"Preliminary engineering and design work will clarify the cost of implementing the second phase of Shah Deniz field development," Abdullayev said.
Abdullayev noted that declared cost of Shah Deniz - 2 project of $25 billion, which was defined during the preparation of a feasibility study is not definitive.
"Cost can vary by 30 percent, either upward or downward in the course of the project," Abdullayev said.
This week, BP announced the preliminary engineering and design work in the second stage of development of offshore gas condensate field Shah Deniz.
The Shah Deniz 2 project is set to produce 16 billion cubic metres of gas per year.
The entry into FEED represents the start of a key phase in the project during which engineering studies will be refined, further wells will be drilled, commercial agreements will be finalised and key construction contracts will commence, BP said.
During the FEED phase of the project, the Shah Deniz consortium will finalise its selection of export routes across Turkey and into Europe.
Gas reserves of Shah Deniz field are estimated at 1.2 trillion cubic meters.
The contract to develop the offshore Shah Deniz field was signed on June 4, 1996. Participants to the agreement are: BP (operator) - 25.5 per cent, Statoil - 25.5 per cent, NICO - 10 per cent, Total - 10 per cent, LukAgip - 10 per cent, TPAO - nine per cent and SOCAR-10 percent.