Azernews.Az

BAKU – Azerbaijan’s state energy firm SOCAR and its partners developing the country’s biggest gas field in the Caspian Sea, Shahdaniz, have signed an agreement to extend the contract by five years to 2036, according to the project operator BP.

The agreement was signed last December, the company said in a report.

SOCAR President Rovnag Abdullayev said the extension of the agreement is due to delays in some operations under the project, but he did not give details.

The prolongation of the contract granted SOCAR the rights to expand the Azerbaijani section of the Baku-Tbilisi-Erzurum (BTE) pipeline pumping Shahdaniz gas or build a new pipeline there. A new conduit would be owned by SOCAR, Abdullayev said.

The new contract will pave the way for implementing long-term gas supply contracts, BP said.

The Shahdaniz field produced about 6.9 billion cubic meters of gas and 1.9 million tons (14.7m barrels) of condensate in 2010. Average daily production was 19m cubic meters of gas and 40,200 barrels of condensate.

According to BP Azerbaijan’s report, since the start of Shahdaniz production in late 2006 till the end of 2010, about 6.3 million tons (49.7 million barrels) of Shahdaniz condensate was exported to world markets.

Peak production during the first stage of Shahdaniz development is forecast at 9bn cubic meters. Gas production may be brought up to 25bn cubic meters per year under the second stage of development.

Shahdaniz holds estimated reserves of 1.2 trillion cubic meters of gas.

Shahdaniz participating interests are: BP (operator – 25.5%), Statoil (25.5%), SOCAR (10%), LukAgip (10%), NICO (10%), Total (10%), and TPAO (9%).