Final investment decision on Shah Deniz-2 project to be made on Dec.17

Oil&Gas Materials 5 December 2013 18:14 (UTC +04:00)

Baku, Azerbaijan, Dec. 5

By Emil Ismayilov - Trend:

Shah Deniz Consortium plans to make a final investment decision on the second phase of development of the offshore Shah Deniz field in the Caspian Sea's Azerbaijani sector on Dec. 17, a source in the oil and gas market told Trend on Thursday.

The contract on development of the Shah Deniz gas and condensate field was signed on June 4, 1996. Stakeholders are: BP (operator) and Statoil with 25.5 per cent each, NICO with 10 per cent, Total with 10 per cent, Lukoil with 10 per cent, TPAO with nine per cent and SOCAR with 10 per cent.

"The final investment decision on Shah Deniz-2 project is expected to be made on Dec. 17, but it is a preliminary date," the source said.

Reserves at the Shah Deniz field are estimated at 1.2 trillion cubic meters of gas.

The cost of the second phase of Shah Deniz field's development is estimated at $25 billion, according to the technical operator, BP's third -quarter report.

They plan to obtain the first volumes of gas in 2018.

The second development phase plans to produce some 16 billion cubic meters of gas (9 billion - during the first phase), six billion cubic meters of which will be transported to Turkey and six billion cubic meters will be delivered to Europe.

The consortium of Azerbaijani Shah Deniz gas and condensate field development announced its choice of the TAP project in late June, as a route for transportation of gas to the European markets.

The gas produced in the second phase of the Shah Deniz field is considered to be the primary source of the project.

The initial capacity of the TAP pipeline will stand at 10 billion cubic meters per year, with a chance of increasing these figures to 20 billion cubic meters per year.

Trans-Anatolian gas pipeline (TANAP) will be built to transport gas through Turkey; this pipeline will ensure gas deliveries to the European border.