BP: Shah Deniz Stage 2 project over 95pct complete

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    BP-Azerbaijan, the operator of the country’s major oil and gas development and transportation projects, has announced that the implementation of the Shah Deniz Stage 2 project successfully continues.

    “The project is now over 95 percent complete in terms of engineering, procurement and construction, and remains on target for first gas from Shah Deniz Stage 2 in 2018,” reads a report released on August 17.

    The contract for development of the Shah Deniz offshore field was signed on June 4, 1996. As part of the Stage 2 of development of the Shah Deniz field, the gas will be exported to Turkey and European markets by expanding the South Caucasus Pipeline and the construction of Trans-Anatolian Natural Gas Pipeline and Trans-Adriatic Pipeline.

    “Project activities continue at all offshore and onshore sites and fabrication yards of the country including the Sangachal Terminal, ATA (AMEC/Tekfen/Azfen) yard near Baku, Baku Deepwater Jackets Factory (BDJF) and along the pipeline route,” the company reported.

    “In June, a significant milestone was achieved in the project with the sail away and installation of the Quarters and Utilities (QU) platform topsides unit – the first topsides unit built for the Shah Deniz Stage 2 platforms. The official sail away ceremony was attended Azerbaijani President Ilham Aliyev. Offshore, the topsides unit was successfully floated over and installed on top of the QU jacket which was already at its location in a water depth of 94 metres. The commissioning of the Production and Risers (PR) topsides unit at the ATA yard is 90 percent complete. The plan is to sail away this second topsides unit for offshore installation in the third quarter of 2017,” the company said.

    The expansion of the Sangachal terminal – already one of the world’s largest oil and gas terminals – is progressing well with the plans to be able to process the additional SD2 gas volumes.

    At the peak of project activities, over 24,000 people were involved in construction works across all main contracts in Azerbaijan and over 80 percent of them were Azerbaijani nationals, the company added.

    Furthermore, the Shah Deniz field continued to provide deliveries of gas in the first half of 2017 to markets in Azerbaijan (to SOCAR), Georgia (to GOGC), Turkey (to BOTAS) and to BTC Company in multiple locations.

    During the two quarters, the field produced about 5.1 billion standard cubic metres (bcm) of gas and 1.2 million tonnes (about 9.7 million barrels) of condensate, BP-Azerbaijan said.

    “The existing Shah Deniz facilities’ production capacity is currently 30.0 million standard cubic metres of gas per day or around 10.9bcma,” the company added.

    As for the Azeri-Chirag-Gunashli (ACG) block of fields, total ACG production for the two quarters was on average 585,000 barrels per day (b/d) (about 106 million barrels or over 14 million tons in total) from the Chirag (56,000 b/d), Central Azeri (129,000 b/d), West Azeri (116,000 b/d), East Azeri (77,000 b/d), Deepwater Gunashli (120,000 b/d) and West Chirag (87,000 b/d) platforms.

    In the first half of 2017, more than $230 million were spent in operating expenditure and about $601 million in capital expenditure on ACG activities, according to the report.

    In 2016, Azerbaijan produced more than 31.1 million tons of Azeri Light oil against 31.3 million tons in 2015.

    A contract for development of the ACG block of oil and gas fields was signed in 1994. The proven oil reserves of the block near one billion tons. Shareholders in the project are BP (operator of the Azeri-Chirag-Gunashli, 35.8 percent), Chevron (11.3 percent), Inpex (11 percent), AzACG (11.6 percent), Statoil (8.55 percent), Exxon (8 percent), TPAO (6.75 percent), Itochu (4.3 percent) and ONGC (2.7 percent).

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