Shah Deniz Signals Early Azeri Gas Export to Turkey

abarrelfullabarrelfull wrote on 09 Aug 2012 12:33
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15 February 2000

BP Amoco, on behalf of the Shah Deniz participants, today gave outline plans for the potential export of Azerbaijan gas to Turkey from the Shah Deniz field in the Caspian Sea.
This follows the successful drilling of the second Shah Deniz well (SDX-2), confirming the existence of a significant gas condensate discovery, which underpins the first stage of a development project.

Andy Hopwood, BP Amoco's Azerbaijan Exploration Business Unit Leader, said: "The gas memorandum signed between the governments of Azerbaijan, Turkey and Georgia in Istanbul in November provided the framework for the export of gas from Azerbaijan. Taken together with the excellent Shah Deniz drilling results, it provides us with the confidence to respond positively to the demands of the market.

"We are presently planning a staged development with a first stage producing 5 billion cubic metres (bcm) a year, subsequently rising to possibly 16 bcm a year. There is confidence that the results of the two wells already drilled, combined with those of a third well to be drilled later this year, should enable us to prove first stage resources of 150 billion cubic metres (5tcf) of gas and 20 million tonnes (150mmbbls) of liquids. The Shah Deniz partners will be working with governments to develop the framework agreed in Istanbul with the objective of delivering first gas to market in the winter of 2002-2003."

Hopwood added: "Azerbaijan - and Shah Deniz in particular - is a competitive source of supply for Turkey given its proximity to the market, the availability of existing infrastructure, and low development costs. The establishment of a competitive gas export route from Azerbaijan will build a bridgehead to the Turkish market and affirm Azerbaijan as an important regional producer of gas, as well as oil."
The first stage concept is based on simple offshore structures in the shallow water area in the north and east of the field. Transportation to the Turkish border will be through a combination of new and existing infrastructure. Detailed engineering is expected to start shortly.

The SDX-2 appraisal well was drilled to a depth of 5,892 metres, penetrating three main horizons. The well is now on a comprehensive testing programme and the first of two planned flow tests is underway. SDX-2 was drilled six kilometres to the south of SDX-1, the original discovery in July 1999.

A third well (SDX-3) will be drilled later this year to further delineate the field, with possibly three more appraisal wells to follow, and the potential for further upgrading of reserves. The field lies in water depths between 50 metres and 600 metres, some 70 kms south east of Baku.

Notes:

The Shah Deniz licence partners are:

  • BP Amoco (operator - UK) 25.5%
  • Statoil Azerbaijan AS (Norway) 25.5%
  • SOCAR Commercial Affiliate (Azerbaijan) 10.0%
  • Elf Petroleum Azerbaijan BV (France) 10.0%
  • LukAgip NV (Russia / Italy) 10.0%
  • Oil Industries Engineering and Construction (Iran) 10.0%
  • Turkish Petroleum Overseas Company Limited (Turkey) 9.0%

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