Operating expenses for Shah Deniz project skyrocket

In the first three quarters of 2021, Shah Deniz spent $1.57 billion in operating expenditure and around $524 million in capital expenditure, the majority of which was associated with the Shah Deniz 2 project, Report informs referring to the business update from the field operator BP Azerbaijan and its partners in the third quarter of this year.

Operating expenses increased by $950 million, or 2.53 times, while capital expenses decreased by $195 million, or 27.1%.

This year, Shah Deniz celebrates its 25th anniversary since the signing of the Shah Deniz Production Sharing Agreement (PSA). The PSA was signed on June 4, 1996 between SOCAR and a consortium of foreign companies. It was ratified by the Milli Majlis and became effective on October 17 the same year.

Shah Deniz participating interests are: bp (operator – 28.83%), TPAO (19.0%), PETRONAS (15.5%), AzSD (10.0%), LUKOIL (10.0%), NICO (10.0%) and SGC Upstream (6.67%).