Momentous Shah Deniz gas sale agreements finalised with European partners

According to a BP statement, the Shah Deniz Consortium finalised a number of 25-year agreements with nine of Europe’s most prominent gas purchasers in Italy, Greece and Bulgaria on 19 September. These will account for just over 10bn m3 (bcm) of gas from the Stage II development of the Shah Deniz field in the Azerbaijani section of the Caspian Sea.

Following the recent selection of the Trans-Adriatic Pipeline (TAP) by the BP-led Shah Deniz Consortium to bring the gas from the European border of Turkey to Italy, up to 16bcm will be transported through more than 3500km of pipelines. TAP will play an integral part in the Southern Corridor, bypassing Russia and providing energy security for Europe.

Rovnag Abdullayev, Chief Executive, State Oil Company of the Azerbaijani Republic (SOCAR) said: “These agreements mark the biggest gas sales in the history of Azerbaijan. They also mark the beginning of direct links between Azerbaijan’s huge gas resources and European markets. Azerbaijan is committed to long-term co-operation with the Shah Deniz gas purchasers. I am sure that this co-operation will bring benefits to consumers across Europe and play an important role in strengthening European energy security.”

Gordon Birrell, Regional President, BP: Azerbaijan, Georgia and Turkey commented: “The Shah Deniz Consortium is proud to be involved in the conclusion of one of the biggest gas deals in the history of the oil and gas industry. The strong demand for Shah Deniz gas gives us confidence in the long-term development of Azerbaijan’s gas resources. Today’s signings represent another important milestone, bringing us closer to a final investment decision on the Shah Deniz II project.”

The gas purchasers are: Axpo Trading AG, Bulgargaz EAD, DEPA Public Gas Corporation of Greece S.A., Enel Trade SpA, E.ON Global Commodities SE, Gas Natural Aprovisionamientos SDG SA, GDF SUEZ S.A., Hera Trading srl and Shell Energy Europe Ltd.