Production Capacity in Shah Deniz Planned to Be Expanded this Year

Vahab Rzayev; During 2013, Shah Deniz spent around $200 million in operating expenditure and $1,700 million in capital expenditure, relevantly up 25.7% and 54.7% in annual comparison. In 2014, it is planned to spend around $200 million in operating expenditure and $4,000 million in capital expenditure. The great majority of this capital expenditure is on the Shah Deniz Stage 2 project, which includes both offshore developments and expansion of Sangachal terminal.

Last year the field produced about 9.8 billion cubic metres (about 345.5 billion cubic feet) of gas and 2.48 million tonnes (19.6 million barrels) of condensate, relevantly up 26.8% and 24% by contrast to 2012. Since the start of Shah Deniz production in late 2006 till the end of 2013, about 47.3 billion standard cubic metres (1,671 billion standard cubic feet) of Shah Deniz gas, and about 99.5 million barrels (12.6 million tonnes) of Shah Deniz condensate has been produced.

As a result of debottlenecking of existing facilities, Shah Deniz Stage 1 capacity has been increased to around 970 million standard cubic feet per day and approximately 55,000 barrels per day of condensate. The Shah Deniz partners have recently agreed terms with SOCAR for further expansion of production capacity to around 1040 million standard cubic feet per day by the end of 2014.

The total cost of...