On December 17, 39 documents will be signed within the final investment decision on the second phase of development of the field Shah Deniz. The signing ceremony is to be held in the Heydar Aliyev Center at 10 a.m.Authorization of Shah Deniz-2 by the partners demonstrates their consent and willingness to invest in the project, thus ensuring its transition from the concept stage to the immediate implementation.The signing ceremony is expected to be attended by the President of Azerbaijan Ilham Aliyev, the British Foreign Minister William Hague, the Croatian Prime Minister Zoran Milanovic, the Italian Prime Minister Enrico Letta and other dignitaries from Greece, Turkey and Albania.Note that half of the gas produced in the framework of Stage 2 will be available in the Italian market. So, from the 16 billion cubic meters 8 billion cubic meters will be sent to Italy, 6 billion cubic meters will be sent to Turkey and 1 billion cubic meters will be supplied to Greece and Bulgaria each.The first gas under the Stage 2 is expected to be produced in 2018. Within two years, the consortium's planned production capacity will reach 16 billion cubic meters, 77% more than production in the framework of Stage 1.The contract to develop the offshore field Shah Deniz was signed in June 1996. The participants in the project are: BP (operator ) - 25.5%, Statoil - 25.5%, SOCAR - 10 %, NICO - 10 %, Total - 10 %, LUKoil - 10 %, and TPAO - 9%. The contract term expires in October 2036.The reserves of Shah Deniz are estimated at 1.2 trillion cubic meters of gas.The cost of the second stage of the development of Shah Deniz is estimated at $ 25 billion, the report by BP (technical operator) for the first three quarters of this year says. This exceeds the investment in Stage 1 6.2 times.On June 28 the consortium to develop the Azerbaijani field Shah Deniz chose the Trans-Adriatic Pipeline (TAP) as a transportation route for its gas to European markets. The gas to be produced within Stage 2 will be the main source for TAP.The initial capacity of the TAP pipeline will be 10 billion cubic meters per year, expandable to 20 billion cubic meters per year. To transport the gas through Turkey the Trans-Anatolian Gas Pipeline (TANAP) will be built, which will ensure delivery to the border with Europe.Recognizing the role of Azerbaijan in the diversification of energy supplies to Europe, the Adviser on Energy of the EU Delegation in Azerbaijan Edita Novak noted that the attention of the EU to the search of new ways to deliver gas is focused on Azerbaijan, notably the giant field Shah Deniz, which lays the foundation of the Southern Gas Corridor.

Authorization of the project will be the starting point of the physical realization of the Southern Gas Corridor, which for the first time in many years will launch a new alternative supplier to Europe. Transporting 10 billion cubic meters of Azerbaijani gas from Shah Deniz may open the way to Europe to other countries and suppliers. These include gas from other fields in Azerbaijan, as well as the giant gas reserves of Turkmenistan.

ANN.Az