Shah Deniz begins gas deliveries to Europe

The Shah Deniz consortium announced commencement of commercial gas deliveries to Europe from the Shah Deniz gas field in the Caspian Sea offshore Azerbaijan.

The gas was delivered via the newly-completed Southern Gas Corridor (SGC) pipeline system. The start of gas deliveries through the final section of the SGC – the Trans Adriatic Pipeline (TAP) – marks the full integration of the entire SGC gas value chain, stretching 3,500 kilometres from Azerbaijan to Europe.

Shah Deniz is located in the Caspian Sea offshore Azerbaijan. To date the field has produced more than 130 billion cubic metres of gas and more than 31 million tonnes of condensate.

The Shah Deniz field is the starting point of SGC, which has been built to deliver Caspian energy resources directly to European markets for the first time. The field is expected to supply 16 billion cubic meters of gas to markets in the region and Europe via SGC.

Rovnag Abdullayev, President of SOCAR, said: "Seven years ago, we made the final investment decision together with our partners. We embarked on this journey by signing 25-year gas sales agreements with European gas distribution companies. The construction of three interconnected gas pipelines across continents with a total length of 3,500-kilometres was a highly complex endeavour. Back then, some were sceptical about this project. Now the mission is accomplished – Azerbaijan’s natural gas has arrived in Europe. Coming from a new source through an alternative route, it will contribute to European energy security. We anticipate a growing demand for additional gas volumes on the European market due to the constant local production decline."

Gary Jones, regional president for Azerbaijan, Georgia and Turkey for bp, the operator of Shah Deniz, said: "The start of gas deliveries to Europe from Azerbaijan is the culmination of years of work by many thousands of people from all the countries involved – the workforce, communities, companies, the government of Azerbaijan and other regional and international governments, and SOCAR and our partners. We are very proud of what we have achieved together. Notwithstanding the complexity of all aspects of the project – engineering, technical, geographical and geopolitical – it has been delivered safely, on schedule and under budget. This is an historic milestone, with Azerbaijan and Europe now connected with a direct, safe and reliable energy link, that again demonstrates that together we can deliver the most complex mega-scale projects successfully."

Shah Deniz participating interests are: bp (operator – 28.8 per cent), TPAO (19 per cent), AzSD (10 per cent), SGC Upstream (6.7 per cent), PETRONAS (15.5 per cent), LUKOIL (10 per cent) and NICO (10 per cent).