Baku, Azerbaijan, Dec.27
By Emil Ismayilov - Trend:
Work on the construction of the upper modules of production and technological platforms including a residential unit as part of the second stage of the development of the Shah Deniz gas condensate field in the Azerbaijani sector of the Caspian Sea will start according to preliminary data, in the spring of 2014, a source in the oil and gas market told Trend on Dec.25.
The source went on to note that work will be undertaken by AMEC-Tekfen-Azfen (ATA) Consortium.
Gas within the second stage of development of the field will be exported to Turkey and the European markets by expanding the South Caucasus gas pipeline and construction of the Trans-Anatolian and Trans-Adriatic (TAP) gas pipelines.
Within the Shah Deniz project, annual production of gas will increase from nine billion cubic meters in the first phase to additional 16 billion cubic meters in the second phase.
The source said the start of construction is planned for late May, early June 2014, but according to preliminary data, may be launched in March.
"If all the necessary conditions including the construction site, equipment and labor power, are provided, launch of construction at early dates will certainly have a positive impact on the project implementation," the source stressed.
The source said that depending on the timing of the start and work progression, the construction of the upper modules of the platforms may be completed in late 2017- early 2018.
Earlier BP, the Shah Deniz project operator, announced the signing of two major contracts with consortiums Tekfen-Azfen and ATA within the project. The cost of the first contract is $998 million and the second, $974 million.
The contracts were signed in Baku on December 17 after the final investment decision on Shah Deniz 2.
Work under the first contract is scheduled to begin in January 2014 and completed in 2018. In particular, it is planned to construct gas and condensate processing facilities at the Sangachal terminal and a pipeline running overland from the landfall of the underwater pipeline to the terminal facilities for transit of gas, condensate and MEG, as well as to reconstruct the existing terminal at Sangachal .
Under the second contract, within five years it is envisaged to construct the upper modules of production and technological platforms including a residential unit. The contractor is responsible for implementation of all these procedures before their commissioning.
Shah Deniz reserves are estimated at 1.2 trillion cubic meters of gas.
Participants on the development of Shah Deniz field are SOCAR (the State Oil Company of Azerbaijan) with the share of 16.7 per cent, the British BP (28.8 per cent), Norway's Statoil (15.5 per cent), Iran's NICO (10 per cent) , French Total (10 per cent), Russia's Lukoil (10 per cent), Turkish TPAO (nine per cent).
The cost of the second stage of Shah Deniz development is estimated at $25 billion.
Translated by M.L.
Edited by S.M.
Additional editing by C.N.