Shah Deniz's Stage-2 to reach peak gas production in 2020
BAKU. Aug 13 (Interfax) - Peak gas production at Stage-2 of the Shah Deniz field will be reached in 2020, according to the environmental impact assessment for Stage-2.
BP-Azerbaijan held public hearings on the assessment on Tuesday.
"Production of the first gas under Stage-2 will begin in 2018. Maximum gas production under Stage-2 is expected in 2020," the document said.
During the public hearings, BP-Azerbaijan's Manager for Environment and Social Issues Bill Bolton recalled that 16 billion cubic meters (bcm) of gas will be produced every year under Stage-2. That is in addition to the 9 bcm per year already being produced at Shah Deniz.
Preparatory work is currently being performed for the project. A final investment decision will be made on Stage-2 at the end of this year, and next year construction will begin, then finish up in 2016. Installation work will kick off in 2017 so that gas production can commence in 2018, Bolton said.
The Stage-2 project involves building two platforms, drilling 26 underwater wells, laying 500 kilometers of offshore pipeline at a depth of 550 meters, expanding the Sangachal Terminal, increasing the throughput capacity of the South Caucasus Pipeline (also known as the Baku-Tbilisi-Erzurum Pipeline) to supply an extra 16 bcm of gas, etc., he said.
Bolton said that in order to deliver Stage-2 gas produced to the Sangachal Terminal, two gas pipelines will be built, and a third will be designed to transport condensate to the shore. Two semisubmersible floating drilling rigs - Istiglal and Heydar Aliyev - will be used to drill wells.
The contract to develop Shah Deniz was signed in Baku on June 4, 1996 and ratified by the Azerbaijani parliament on October 17 of that year. The participants in Shah Deniz are BP (operator, 25.5%), Statoil (25.5%), the State Oil Company of the Azerbaijan Republic (Socar) (10%), Lukoil (10%), NICO (10%), Total (10%) and TPAO (9%).
Stage-2 is estimated to cost $28 billion. Sixteen bcm of gas will be produced there per year, 10 bcm of which will be sent to Europe, and 6 bcm to Turkey's western regions. Gas deliveries to Europe will kick off in 2019.
On June 28, 2013, the Shah Deniz consortium officially announced the project to construct the Trans Adriatic Pipeline (TAP) for exporting gas from Stage-2.
