Azernews.Az

Capacity of the South Caucasus Pipeline (SCP), a section of the Baku-Tbilisi-Erzurum (BTE) gas pipeline, will be increased up to 30 billion cubic meters per year to transport gas to be produced during the second phase of the Azerbaijani Shah Deniz gas condensate field development -- due to begin by late 2017, Azerbaijani Energy Minister Natig Aliyev said Tuesday.

"However, the pipeline can be expanded up to 35-37 billion cubic meters of gas per year," Aliyev told journalists.

The minister said increasing the pipeline's capacity is primarily necessary for transporting an additional 16 billion cubic meters of gas from the Shah Deniz Phase 2 in addition to nine billion extracted during Phase 1. But, if necessary, the pipeline could be expanded even further up to 55 billion cubic meters of gas per year.

Last week, BP announced that the Shah Deniz consortium approved the decision to commence Front End Engineering and Design (FEED) on the estimated $25 billion Shah Deniz Stage 2 project. According to BP, the entry into FEED represents the start of a key phase in the project during which engineering studies will be refined, further wells will be drilled, commercial agreements finalized and key construction contracts commenced.

During the FEED phase of the project, the Shah Deniz consortium will finalize its selection of export routes across Turkey and into Europe.

Shahdaniz reserves are estimated at 1.2 trillion cubic meters of gas.

The contract to develop the field was signed in 1996. The shareholders are BP and Statoil, with 25.5 percent each, NICO with 10 percent, Total (10 percent), LukAgip (10 percent), TPAO (9 percent), and Azerbaijan’s state energy firm Socar (10 percent).