TODAY.AZ / Business

Shah Deniz sees 100 billion cubic meters of gas production

07 January 2019 [15:00] - TODAY.AZ

By Azernews

By Leman Mammadova

The total gas production from the Shah Deniz field has reached 100 billion cubic meters.

The milestone was achieved at the end of December, exactly 12 years after the first announcement of the start-up of commercial gas production from the field and operations of the South Caucasus Pipeline, BP Azerbaijan told Trend.

December 15, 2006, marked the start of the first stage of the development of the field and since then gas volumes have been successfully delivered to the markets of Azerbaijan, Georgia and Turkey.

2018 was destined to become the next biggest milestone year for Shah Deniz. It marked the commencement of commercial gas deliveries to Turkey from Shah Deniz 2 as planned on 30 June and the achievement of first gas production from Shah Deniz Bravo platform at the end of July.

Since 2006, more than 196 million barrels of condensate have been produced in the Shah Deniz field in total.

Currently, production is also carried out at 10 wells on the platform "Alpha", and six wells on the platform "Bravo".

Shah Deniz field covers approximately 860 square kilometres. The field was discovered in 1999.

Shah Deniz is a giant gas condensate field, reserves of which are estimated at 1.2 trillion cubic meters of gas and 240 million tonnes of condensates. Within the second stage of field development, the volume of gas production can be increased to 24 billion cubic meters per year, according to forecasts.

The discovery of the giant Shah Deniz field and the successful implementation of the project made Azerbaijan a country that can export a large amount of natural gas to the world.

The Shah Deniz gas field is still the biggest discovery of BP after the Prudhoe Bay oilfield in Alaska. SOFAZ (Azerbaijani Oil Fund) has so far earned $ 2.5 billion from development of Shah Deniz.

Shah Deniz Consortium has spent $ 1.558 billion on the development project of the Shah Deniz gas condensate field located in the Azerbaijani sector of the Caspian Sea.

The agreement on the exploration, development and shared production of promising areas of Shah Deniz was signed on June 4, 1996. The agreement on the division of production was ratified on October 17, 1996.

The project participants are BP (operator - 28.8 percent), AzSD (10 percent), SGC Upstream (6.7 percent), Petronas (15.5 percent), LUKOIL (10 percent), N?KO (10 percent) and TPAO (19 percent).

Shah Deniz 2 is the starting point of the new Southern Gas Corridor, which will deliver Caspian resources directly to European markets for the first time, through Italy, Georgia, Turkey, Greece, Bulgaria, Albania and the seabed of the Adriatic Sea.

The Southern Gas Corridor, $ 40 billion worth project, envisages the transportation of gas to Turkey and Europe through the pipeline, which will be operated within the second stage of the Shah Deniz gas condensate field project in the Azerbaijani sector of the Caspian Sea.

The Southern Gas Corridor consists of four projects: Shah Deniz 2, Expansion of South Caucasus Pipeline (Baku-Tbilisi-Erzurum), the Trans Anatolian Pipeline (TANAP) and Trans Adriatic Pipeline (TAP). The projects have an estimated investment cost of approximately $40 billion.

Three of four projects have been completed. Approximately 82 percent of the TAP construction project was completed. The project will be totally operational in 2020.

At the initial stage, it is planned to transport 6 billion cubic meters of gas to Turkey and 10 billion cubic meters of gas to Europe. Due to this giant project Azerbaijan will become important gas supplier for Europe.

On May 29, Baku hosted the launch of the first phase of the Southern Gas Corridor project, and on June 12, the opening ceremony of the TANAP took place in the Turkish province of Eskisehir.

Thus, the first 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.


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