Total exits Shah DenizStaff writer ▼ | May 31, 2014
Total will exit the Shah Deniz field, following an agreement the French explorer reached with Turkish state-owned oil company TPAO.Total will exit the Shah Deniz field, following an agreement the French explorer reached with Turkish state-owned oil company TPAO.
Total will sell its 10% interest in Azerbaijan field and associated South Caucasus pipeline for $1.5 billion. The additional 10% stake increases TPAO's hold to 19%, making it the second largest shareholder in the field next to operator BP, which holds 28.83% interest. The agreement was signed in Istanbul and witnessed by Turkish Prime Minister Recep Tayyip Erdogan and Turkish Energy and Natural Resources Minister Taner Yildiz.
The Shah Deniz field, covering 860sq km, is located 100km southeast of Baku in the Caspian Sea in water depths ranging from 50-550m. The field began producing in 2006, with its current output at 200,000 boe/d. In 2013, the Shah Deniz consortium approved a $28 billion phase 2 development at the field that will see 16 billion cu. m/yr of gas moved 3500km from the field to consumers in Georgia, Turkey, Greece, Bulgaria and Italy. First production from phase 2 is expected by 2018.
BP's other partners in Shah Deniz include the State Oil Company of Azerbaijan Republic (SOCAR) (16.67%), Statoil (15.5%), Lukoil (10%), and Nico (10%). ■