Baku: PM Garibashvili on the importance of the second phase of Shah Deniz project

Baku is hosting the signing ceremony of the final investment agreement on the second phase of the Shah Deniz project, which at its initial stage outlines the transportation of Azerbaijani gas to the European markets.

Georgian Prime Minister Irakli Gharibashvili delivered a speech at the meeting and spoke about the importance of the project.

"Implementation of such project like Shah Deniz with investments of around 40 billion USD in six different countries will definitely bring stability, economic growth and prosperity in these states, promote development of regional market, increase flexibility, and energy security, Garibashvili said.

PM Garibashvili underlined the role of Azerbaijan in terms of addressing energy security needs of the countries in the region and European Union. He noted that this step is only the beginning of multilateral cooperation in the energy sector.

"At the same time, Georgias location makes the country a transportation hub for the South Caucasus region and a key link together with Turkey, in the shortest transit route between Europe and Caspian Region, Garibashvili noted.|/

The ceremony started with the speech from Azerbaijans President Ilham Aliyev. He called it a significant day in the history of Azerbaijan. Aliyev underlined that Shah Deniz is one of the biggest energy projects of the world.

Aliyev emphasized that Shah Deniz-2, TAP, and TANAP are the world's largest energy projects and said it is expected that 35 billion USD will be invested and 30,000 new jobs will be created within these projects.

"It is a project of energy security, energy diversification, project of broad international cooperation between countries and companies involved in this historic project," President Aliyev said.|/

 The prime ministers of Albania, Bulgaria and Croatia also delivered speeches at the meeting.

Within the second phase of the field's development, it is planned to produce some 16 billion cubic meters of gas (within the first phase - 9 billion), six billion of which will be transported to Turkey and six billion to Europe. The first gas supplies to Turkey as part of this project will start in 2018 and to Europe in 2019.

Bob Dudley, Group Chief Executive of BP, the operator of the Shah Deniz Stage 2 and SCP expansion project, said that very few projects have the ability to change the energy map of an entire region.

"I am proud that BP can be part of this historic moment, and grateful for the efforts of so many people in making this possible. As well as creating tens of thousands of jobs along the route of the pipelines in Azerbaijan, Georgia, Turkey and Europe, this project represents the largest ever foreign investment to Azerbaijan," Dudley said.|/

Shah Deniz-2 is a huge project with an estimated cost of $25 billion. That cost includes installation of two offshore platforms, connected to each other via a bridge, drilling of more than 20 underwater wells with two semi-submersible drilling rigs, construction of 500 kilometers of underwater pipelines at a depth of 550 meters, extension of the Sangachal terminal, and expansion of the South Caucasus Pipeline (SCP).

The contract to develop the offshore Shah Deniz field was signed on June 4, 1996. Participants to the agreement are: BP as an operator (25.5 percent), Norway's Statoil (25.5 percent), Iran's NICO (10 percent), France's Total (10 percent), Russia's Lukoil (10 percent), Turkey's TPAO (nine percent) and SOCAR, the state oil company of Azerbaijan (10 percent).

Trans-Anatolian (TANAP) gas pipeline will be constructed for transportation of gas through Turkey's territory.