Shah Deniz is celebrating its 25th anniversary in 2021. This is an important milestone for both the government of Azerbaijan and bp and Shah Deniz partners.
25 years ago, on 4 June 1996, the Shah Deniz Production Sharing Agreement (PSA) was signed in Baku between SOCAR and a consortium of foreign companies. The PSA was ratified by the Milli Majlis and became effective on 17 October the same year.
Shah Deniz is one of the largest gas-condensate fields in the world and the largest gas discovery ever made by bp.
For almost 15 years, Shah Deniz has proved to be a secure and reliable supplier of gas to Azerbaijan, Georgia and Turkey through the South Caucasus Pipeline (SCP).
With the completion of the Southern Gas Corridor (SGC) in December 2020, Shah Deniz has become a new source of energy supply for Europe providing natural gas from the Caspian to European customers thousands of miles away.
The discovery and development of Shah Deniz has underpinned Azerbaijan’s increasing role as a major regional and international gas supplier adding to the country’s oil and gas revenues for decades to come. The project has brought the largest foreign direct investment to Azerbaijan and further strengthened the country’s economy. Azerbaijan has gained new onshore assets, offshore facilities end export infrastructure – all built to international standards using advanced technology.
The Shah Deniz 25th anniversary marks an important milestone in the new history of Azerbaijan’s oil and gas industry. It is also a historical date for SOCAR, bp and all other partners in the Shah Deniz PSA.
SOME KEY SHAH DENIZ FACTS AND FIGURES:
- Shah Deniz is located on the deep-water shelf of the Caspian Sea, 70 km south-east of Baku, in water depths ranging from 50 to 600 metres.
- The giant field is stretching out over 140 square kilometres.
- Shah Deniz was discovered in 1999 – with approximately 1 trillion cubic metres of gas and 2 billion barrels of condensate initially in place.
- The first phase of Shah Deniz came on production in 2006 and currently produces more than 10 billion cubic metres per annum (bcma) of gas delivering it to Azerbaijan, Georgia and Turkey.
- On 17 December 2013, the Shah Deniz consortium announced the final investment decision (FID) for the Shah Deniz 2 development.
- The second phase of the Shah Deniz development came online in 2018 and will add 16 bcma of gas bringing the total production from the field up to 26 bcma.
- Since the start of production till the end of 1Q 2021, Shah Deniz produced 140 billion cubic metres of gas and about 33 million tonnes of condensate.
- The existing Shah Deniz facilities’ production capacity is currently over 58 million standard cubic metres of gas per day or more than 21 bcma.
- Shah Deniz wells are among bp’s most productive wells. The current top producer Shah Deniz well produces 36 thousand barrels of oil equivalent per day.
- A total of 32 wells – 11 on Shah Deniz 1 and 21 on Shah Deniz 2 - have been drilled on Shah Deniz to date. Out of them, 19 wells are currently producing.
- Around 96 bcm of Shah Deniz gas have been exported through SCP since the launch of the pipeline in 2006.
- Capital expenditure in the Shah Deniz project by the end of 1Q 2021 was $27 billion.
- Shah Deniz has had an excellent safety record and, as an environmentally sound project, it has conducted around 14 Environmental Impact Assessments and 48 offshore, onshore and near-shore monitoring surveys since start.