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Eurasia
July 6, 2018 www.intellinews.com I Page 23
Azerbaijan celebrates launch of $28bn Shah Deniz 2 field set to supply gas to Europe
bne IntelliNews
Azerbaijan on July 1 celebrated the launch by BP and partners of the $28bn Shah Deniz 2 gas field development, from which gas will be sent by pipe- line to Georgia, Turkey, Greece, Albania and Italy.
Shah Deniz, located in the Caspian Sea, was discovered in 1999 and hailed as BP’s largest ever gas find. The giant field, estimated to hold approx- imately 1 trillion cubic metres of gas and covering approximately 860 square kilometres, is roughly the same size and shape as Manhattan Island. The first phase of field development, Shah Deniz 1, began production in 2006 and currently supplies gas to Azerbaijan, Georgia and Turkey, but for the past decade the Azerbaijani hydrocarbon dream has been to open up Shah Deniz 2 to achieve a complex megaproject and source enough gas to make an impact on European Union markets.
Gas from Shah Deniz 2 is to be exported through three interconnected pipelines that will make up the $40bn and 3,500-km Southern Gas Corridor (SGC) stretching to Melendugno in southeast Italy. The gas is to transit along an already completed extension of the 700-km South Caucasus Pipe- line (SCP) to reach Turkey via Georgia. It then enters the 1,850-km and $8bn Trans Anatolian Natural Gas Pipeline (TANAP), launched on June 12, and traverses Turkey to flow to Greece. From there, the 878-km Trans Adriatic Pipeline (TAP)— to run from Greece to Albania and then onwards to Italy via an undersea route—forms the last leg of the SGC. TAP is still under construction, but BP says it should be operational in time to make
Gas from Shah Deniz 2, located offshore from Baku, will flow from Azerbaijan to Georgia to Turkey, and then onwards to Italy via Greece, Albania and an undersea Adriatic route. The final part of the gas corridor, the Trans Adriatic Pipeline, is due to go operational in 2020.
commercial deliveries of Shah Deniz 2 gas to western Europe a reality by 2020. TAP was said to be two-thirds complete in February.
If targets are fulfilled the SGC could be delivering around 4% of the European bloc’s gas supplies by the early 2020s and, after capacity expansions, could add several more percentage points to that share in subsequent years.
Shah Deniz 2 and the SGC will eventually compete with Russia’s TurkStream pipeline (sometimes referred to as Turkish Stream), forks of which
will by late 2019 send gas to Turkey and perhaps Bulgaria via Black Sea routes, according to plans. The SGC has the advantage of being an initiative of the European Commission to help Europe diversify away from over-reliance on Russian Gas. Some eurocrats hope that it will one day also carry gas to Europe from Middle Eastern regions.
Announcing the Shah Deniz start-up, BP said the first commercial gas delivery to Turkey was al- ready under way. The BP-operated project is the first subsea development in the Caspian Sea and the largest subsea infrastructure operated by BP worldwide.
BP group chief executive Bob Dudley said: “Shah Deniz 2 is one of the biggest and most complex new energy projects anywhere in the world, comprising major offshore, onshore and pipeline developments. BP and our partners have safely and successfully delivered this multi-dimensional