Azerbaijan’s state oil company SOCAR is to increase its participation in Shah Deniz and South Caucasus Pipeline projects, Trend reports with reference to the company.

Following Petronas’s decision to sell its stakes in the production sharing agreement for the exploration and development of the Shah Deniz field in the Azerbaijani sector of the Caspian Sea, SOCAR acquired 4.35 percent of stakes from Petronas in accordance with the terms of the agreement between Shah Deniz project partners. LUKOIL and bp, both partners at Shah Deniz consortium, acquired the other part of Petronas’s 15.5 percent stakes in the project. Ultimately, SOCAR’s direct participation in the project is growing to 14.35 percent.

The respective agreement is expected to enter into force in January 2022. Apart from this, the Ministry of Economy of Azerbaijan and SOCAR hold 51 percent and 49 percent shares in Southern Gas Corridor Closed Joint-Stock Company, which in turn has a 6.67 percent stake in Shah Deniz project.

Along with the shift in stakes of companies in the Shah Deniz project, equivalent changes took place in the distribution of stakes between companies in the South Caucasus Pipeline, one of the segments of the Southern Gas Corridor.

The production sharing agreement (PSA) for the exploration and development of the Shah Deniz prospect in the Azerbaijani sector of the Caspian Sea was signed on June 4, 1996 between SOCAR and a consortium of international companies. The field is located in the Azerbaijani sector of the Caspian Sea, 70 kilometers southeast of Baku. The final investment decision on the second phase of development of the Shah Deniz field and the Southern Gas Corridor was announced on the 17th of December 2013. In 2018, first natural gas produced under Shah Deniz 2 project was delivered to Turkey. Starting from December 31, 2020, natural gas from Shah Deniz field is being supplied to European countries via the Southern Gas Corridor.

Source: Trend News Agency