A group of companies led by BP has signed a multi-billion dollar deal to pipe natural gas from a field off the coast of Azerbaijan to Europe.
The consortium announced yesterday it has taken a final investment decision for the second stage of the Shah Deniz gas field in the Caspian Sea.
The deal will see the expansion of the South Caucasus Pipeline through Azerbaijan and Georgia and more pipelines built across Turkey and into Greece, Albania and Italy.
Around 16 billion cubic metres per year (bcma) of gas produced from the giant field will be carried 3,500 kilometres to EU nations. Condensate production is expected to rise to 120,000 barrels per day from current levels of around 55,000 barrels per day.
Foreign Secretary William Hague said: “The announcement of the Shah Deniz 2 development is welcome news for Azerbaijan, for the UK and for Europe. This adds to Europe’s energy security and competitiveness by opening up a new source of gas for southern Europe.
“The deal will also be good news for the UK – with many of the 300 firms based in Azerbaijan gaining from this major new project.”