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    Shah Deniz Production Increases by 9.5% in 1H15



Azerbaijan's Shah Deniz Stage 1 produced about 5.2 bcm of gas in 1H15, 9.5 % more than last year

by: Ilham Shaban

Posted in:

Natural Gas & LNG News, South Caucasus (Baku-Tbilisi-Erzurum|BTE), News By Country, Azerbaijan

Shah Deniz Production Increases by 9.5% in 1H15

BP plc, the operator of Azerbaijan's offshore Shah Deniz gas field released a report a report today indicating that the output from Shah Deniz Stage 1 (SD1) increased by 9.5 percent to 5.2 billion cubic meters (bcm) in first half of 2015, in comparison to the same period last year.

The increase at SD1 occurred as a report published by the State Oil Company of Azerbaijan Republic (SOCAR) last week, indicated that the country’s total gas production decreased by 0.711 bcm to 14.68 bcm in the first half of 2015. This volume includes also the re-injected and flaring gas.

SOCAR’s report said that this company’s own gas production decreased by 0.448 bcm to 3.373 bcm.

BP also reported that the amount of delivered associated gas from Azeri-Chirag-Deepwater Gunashli (ACG) to Azerbaijan in six months was 2.1 bcm.

Therefore, with comparing the SOCAR and BP’s statistics, Azerbaijan’s produced 10.673 bcm of commercial gas in 1H15 in total and the remained volume (4 bcm) of gas has been re-injected to oil wells.

BP also said that the existing Shah Deniz facilities’ production capacity is currently 29.5 mcm/d or around 10 bcm per annum (bcm/a).

The report says during the first half of 2015 (1H15), Shah Deniz spent approximately $0.25 billion in operating expenditure and $2.26 billion in capital expenditure, the majority of which was associated with the Shah Deniz Stage 2 project.

During the 1H14, operating expenditure was $0.243 billion, while capital expenditure was $1.766 billion.

The South Caucasus Pipeline (SCP)

BP also reported that in the first half of 2015, SCP spent about $22 million in operating expenditure and $559 million in capital expenditure.

The pipeline has been operational since late 2006, transporting Shah Deniz gas to Azerbaijan, Georgia and Turkey.

In the first half, SCP’s daily average throughput was 20.34 million cubic meters of gas per day.


In the second quarter, the existing Shah Deniz Stage 1 platform completed the SDA07 gas production well and continued drilling another production well, whilst the Istiglal and Heydar Aliyev rigs continued drilling operations in support of the Shah Deniz Stage 2 pre-drill program.

The Istiglal rig was transferred to the shipyard for rig certification and upgrade in July 2015. The Heydar Aliyev rig will continue drilling activities. These two rigs have already drilled eight production wells in preparation for the first gas and consequent production ramp up.