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Shah Deniz on stream

December 18, 2006, 10:00 CET

The Shah Deniz development in Azerbaijan’s sector of the Caspian becomes one of the world’s largest producing gas fields today, 15 December.

With a 25.5% working interest, Statoil is responsible for selling output from this BP-operated discovery as operator for the Azerbaijan Gas Supply Company.

The gas in Shah Deniz corresponds to two-thirds of the 1,325 billion standard cubic metres originally present in the Troll Gas development operated by Statoil in the Norwegian North Sea.

– This is a milestone for our international gas production and marketing, says Jan Heiberg, vice president for the group’s gas operations in Azerbaijan.

Statoil also has an 8.56% working interest in the Azeri-Chirag-Gunashli (ACG) field in the Caucasian nation’s Caspian sector. The Central Azeri component came on stream in 2005.

"Azerbaijan has become one of the most important countries in our international business,” Mr Heiberg notes.

Some Shah Deniz gas will be sold domestically, but most is going to Turkey and a proportion to intervening Georgia through the new South Caucasus Pipeline (SCP).

This transport system stretches for 690 kilometres, paralleling the Baku-Tbilisi-Ceyhan oil pipeline from Azerbaijan to the Georgia-Turkish border.

As the gas buyer, Turkey’s Botas group takes over the gas transport job at the border. A new pipeline ties into the existing Turkish distribution network at the city of Erzurum.

According to BP, Shah Deniz will reach plateau production of roughly nine billion cubic metres annually in 2009.