Azerbaijan will keep BP as the core partner for its biggest gas development for many more decades, a senior official said on Wednesday in a move that will boost the oil major's growth prospects and allay fears over its future in the country.
BP has been at the forefront of the Azeri oil and gas industry since the collapse of the Soviet Union.
But relations soured in 2012 when Azeri President Ilham Aliyev said BP had made "false promises" about the amount of oil it would produce from huge Azeri fields and the country was short of revenues because of lower-than-expected output.
Relations have improved since then and the new comment signals BP is poised to retain its position of a leading oil major in the Caspian Sea nation.
It comes as BP is looking for new areas of growth having finally reached a settlement this year with U.S. authorities over the 2010 Macondo spill.
"SOCAR and BP plan to continue cooperation in implementation of Shah Deniz-3 project after completion of Shah Deniz-2," the senior official at Azerbaijan's state energy firm SOCAR, who asked not to be named, told Reuters.
Shah Deniz, which translates as the King of the Sea, is Azerbaijan's major gas field and is being developed by SOCAR and BP as well as Turkish, Malaysian and Russian companies and Iran's state energy company NIOC.
Shah Deniz has been pumping gas to Turkey since 2006 as part of phase one, while gas from its second stage is expected to reach Europe by 2019-2020 with production due to begin at the end of 2018.
The official said phase one would produce a total of 200 billion cubic metres (bcm) of gas during the course of its life - equal to two fifths of EU's annual gas consumption.
Phase 2 will produce another 400 bcm while phase 3 will become the biggest development with its total output expected to amount to 600 bcm. The official did not specify when phase 3 could start. BP declined to comment.
(Reuters)
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