Advisor on Lukoil deal on acquisition of interest in Shah Deniz project revealed

Akin Gump has advised PSJC LUKOIL in its acquisition of a 15.5% interest in the Shah Deniz natural gas project in the Azerbaijani sector of the Caspian Sea, from Malaysia’s PETRONAS, Report informs referring to the company’s message.

The transaction is valued at $2.25 billion, and the completion is subject to the fulfillment of certain conditions precedent, including approval by SOCAR, the State Oil Company of the Azerbaijan Republic. The transaction closed on October 7, 2021.

Following completion of the sale, LUKOIL's interest in the Shah Deniz natural gas project will increase to 25.5%. The other parties in the project are SOCAR, bp, Turkey’s TPAO (Turkiye Petrolleri Anonim Ortakligi), Iran's Switzerland-based NICO (Naftiran Intertrade Company), and the European Commission's SGC (Southern Gas Corridor).

The Shah Deniz gas condensate field is located in the Azerbaijani sector of the Caspian Sea, 70 km southeast of Baku. The project is being implemented under a production sharing agreement (PSA). Commercial production under the project started in 2006.