Shah Deniz begins evaluating transportation bids

Shah Deniz consortium to decide who will carry gas from Azerbaijan

The Shah Deniz project will bring gas from the Caspian Sea to Turkey and Europe.
The Shah Deniz project will bring gas from the Caspian Sea to Turkey and Europe.

The Shah Deniz consortium has begun evaluating binding transportation offers from the two pipeline consortia offering to carry gas from the Shah Deniz field in Azerbaijan into Europe.

The two consortia, Nabucco Gas Pipeline International and Trans Adriatic Pipeline (TAP), have been in extensive negotiations with the Shah Deniz consortium following delivery of their initial gas transportation offers at the end of March 2013.

Those offers have now been approved by their shareholders and have become final and binding.

Furthermore, the consortium also received gas sales offers for more than 30 billion cubic metres of gas a year (BCMA) from more than 15 different gas buyers across Europe. The gas sales offers will be considered alongside the transportation offers to determine the commerciality of the pipeline options and the respective markets.

Nabucco Gas Pipeline International and Trans Adriatic Pipeline (TAP) are offering to carry 10 BCMA of gas to different markets in Central and Southern Europe. The Shah Deniz consortium is currently finalising its assessment of these offers.

The Shah Deniz Stage 2 project will bring gas from the Caspian Sea to markets in Turkey and Europe, opening up the ‘Southern Gas Corridor’. Shah Deniz Stage 2 is expected to add a further 16 billion cubic meters per year (bcma) of gas production to the approximately 9 bcma from Shah Deniz Stage 1.

This Stage 2 development of the Shah Deniz field, which lies some 70 kilometres offshore in the Azerbaijan sector of the Caspian Sea, is expected to include two new bridge-linked production platforms; 26 subsea wells to be drilled with 2 semi-submersible rigs; 500 km of subsea pipelines built at up to 550m of water depth; a 16 bcma upgrade for the South Caucasus Pipeline (SCP); and expansion of the Sangachal Terminal. Further pipelines will be built and expanded to transport Shah Deniz gas through Turkey and Europe.

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