bp agreed to new developments with state oil company SOCAR for the third major phase of development of Shah Deniz gas field in the Azerbaijan sector of the Caspian Sea.
Developments for the project, Shah Deniz Compression, include the linked 240 Mw Shafag solar and Sangachal terminal electrification projects, which are expected to reduce emissions at the bp-operated terminal, freeing up fuel gas for export, bp said in a release June 3.
The $2.9 billion Shah Deniz compression project is designed to access and produce low pressure gas resources. It will include the installation of a new unmanned compression platform and is expected to produce an additional gross 50 billion cu m of gas and 25 million bbl of condensate. Construction is planned to begin later this year with first gas for compression in 2029 from the Shah Deniz A platform and 2030 from the Shah Deniz B platform in 2030.
The agreements also will provide access to two new exploration and development licenses and introduce a new partner to accelerate exploration on a third. Two blocks will be accessed in the Caspian Sea to access Karabagh oil field and the Ashrafi-Dan Ulduzu-Aypara (ADUA) area. bp will have 35% working interest and become operator of each block, with SOCAR retaining 65%.
bp and SOCAR also reached agreement for Türkiye’s TPAO to take a 30% interest in the production sharing agreement for Shafag-Asiman block in the Caspian Sea. This is expected to accelerate evaluation of development opportunities for the block, on which a first well drilled in 2021 encountered gas condensate resources.
bp is operator of Shah Deniz (29.999%) with partners Lukoil (19.99%), TPAO (19.00%), SGC (16.02%), NICO (10.00%) and MVM (5.00%). The field, discovered in 1999, covers about 860 sq km and had about 1 trillion cu m of gas and 2 billion bbl of condensate initially in place.
Since start-up, Shah Deniz has produced about 243 bcm of gas and 50 million tonnes of condensate.
Alex Procyk | Upstream Editor
Alex Procyk is Upstream Editor at Oil & Gas Journal. He has also served as a principal technical professional at Halliburton and as a completion engineer at ConocoPhillips. He holds a BS in chemistry (1987) from Kent State University and a PhD in chemistry (1992) from Carnegie Mellon University. He is a member of the Society of Petroleum Engineers (SPE).
