Shah Deniz II, South Caucasus Pipeline contracts awarded

The Shah Deniz and South Caucasus Pipeline consortia awarded project management and construction contracts for the development of Shah Deniz Stage 2 and the South Caucasus Pipeline Expansion (SCPX).

A joint venture of Bechtel International Inc. and Enka Insaat ve Sanayi AS was let a $528 million contract for construction and commissioning support of SCPX in Georgia. The scope of work includes building a 16-km access road, two 120-Mw compressor stations, and a pressure reduction and metering station. SCPX expects completion in 2018.

Chicago Bridge & Iron UK Ltd. (CB&I) was let a $174 million contract for SCPX pipeline and facilities engineering and project management, also set for 2018 completion. Wood Group Kenny Ltd. will perform initial subsea and pipeline engineering and project management.

DrillTec GMBH will carry out horizontal directional drilling and line pipe installation for five SCPX river crossings ($26 million) by 2016. CSM Bessac will perform shaft and tunnel construction and line pipe installation ($24 million) for two other SCPX river crossings—one in Azerbaijan and one in Georgia—by 2017.

The Shah Deniz consortium let the $32 million contract for engineering, procurement, and construction of the offshore platform living quarters to Apply Emtunga for completion in 2017. The living quarters will be assembled and built at the ATA fabrication yard in Bibi-Heybat near Baku, using local resources.

BP said the contracts will allow first gas to be delivered on schedule and budget in late 2018. The company noted that the offshore Istiglal drilling rig had completed drilling five production wells on the field and that the Heydar Aliyev rig had resumed drilling activities in the western part of the field following upgrade and recertification. These two rigs will remain working on Shah Deniz field to deliver all 26 wells required to ramp production up to the planned plateau level of 16 billion cu m (bcm)/year, according to BP.

The first consignments of steel for fabrication of the platform jackets arrived in Baku in December 2013, and on Feb. 22 the first steel for fabrication of the platform decks arrived at the ATA fabrication yard in Bibi-Heybat. The AMEC-Tekfen-Azfen (ATA) consortium comprised of AMEC MMC, Tekfen Insaat ve Tesisat AS, and Azfen is performing fabrication, load out, and offshore hook-up and commissioning of the topsides units of Shah Deniz’s two Stage 2 production platforms.

The 16 bcm/year from Shah Deniz II, 70 km offshore Baku in the Azerbaijan sector of the Caspian Sea, will more than double the 9 bcm/year produced at Shah Deniz Stage I (OGJ, Feb. 3, 2014, p. 97).

The Shah Deniz II consortium consists of BP 25.5%, Statoil 25.5%, State Oil Co. of Azerbaijan Republic 10%, Lukoil 10%, Total 10%, Naftiran Intertrade Co. 10%, and Turkish Petroleum AO 9%. The same companies comprise South Caucasus Pipeline Co.

Contact Christopher E. Smith at chriss@ogjonline.com.

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