BP plc and its partners in the Shah Deniz consortium announced Monday the start-up of the Shah Deniz 2 gas development in Azerbaijan.
The BP-operated, $28 billion-project is the first subsea development in the Caspian Sea and the largest subsea infrastructure operated by BP worldwide.
At plateau, Shah Deniz 2 is expected to add 16 billion cubic meters of gas per year (bcma) to current Shah Deniz production. Together with output from the first phase of development, BP revealed that total production from the Shah Deniz field will be up to 26 bcma of gas and up to 120,000 barrels of condensate per day.
Offshore, the Shah Deniz 2 project includes 26 subsea wells, 310 miles of subsea pipelines and flowlines and two new bridge-linked platforms. Gas is transported onshore through a 52 mile pipeline to the Sangachal terminal near Baku, which underwent an expansion to accommodate the new increased gas output.
The project also includes the new South Caucasus pipeline expansion – 265 miles of new pipeline in Azerbaijan and 36 miles in Georgia, including two new compressor stations around the size of 20 soccer pitches each – carrying Shah Deniz gas to Turkey.
At peak, the Shah Deniz 2 development, which was sanctioned in 2013, supported more than 30,000 jobs in Azerbaijan and Georgia and in total included over 180 million hours of work, BP revealed.
The company described Shah Deniz 2 as a “major milestone” in the creation of the new Southern Gas Corridor, which, once completed, will transport Caspian gas directly into the heart of European markets for the first time.
“Shah Deniz 2 is one of the biggest and most complex new energy projects anywhere in the world, comprising major offshore, onshore and pipeline developments. BP and our partners have safely and successfully delivered this multi-dimensional project as designed, on time and on budget,” BP Group Chief Executive Bob Dudley said in a company statement.
“Together with the Southern Gas Corridor pipeline system, Shah Deniz 2 will deliver significant new energy supplies to Europe, further diversifying its sources of energy and providing new supplies of natural gas which will be essential in the energy transition,” he added.
Bernard Looney, BP’s upstream chief executive, described the project as “huge”.
“Bringing this huge project online within the schedule and budget we set out at sanction 4.5 years ago is further evidence of our focus on efficient and disciplined project execution,” Looney said in a company statement.
“As our largest start-up for the year, Shah Deniz 2 is also a very important milestone in delivering our plans for growth, including from our pipeline of new higher-margin projects,” he added.
In a statement on social media platform Twitter, BP said Shah Deniz 2 is the biggest natural gas project in its “growing gas portfolio”.
Shah Deniz, located in the Caspian Sea offshore Azerbaijan, is the largest gas discovery ever made by BP. Discovered in 1999, the first phase of field development, Shah Deniz 1, began production in 2006 and currently supplies gas to Azerbaijan, Georgia and Turkey.
The Shah Deniz consortium comprises; BP (28.8 percent and operator), TPAO (19 percent), Petronas (15.5 percent), AzSD (10 percent), SGC Upstream (6.7 percent), Lukoil (10 percent), and NICO (10 percent).
