Shah Deniz 2 contracts awarded

The Shah Deniz and South Caucasus Pipeline consortia have awarded key contracts for the development of the Shah Deniz Stage 2 and South Caucasus Pipeline Expansion (SCPX) projects.

The contracts, covering project management services and construction, follow the final investment decisions announced on 17 Dec 2013.

Since the beginning of 2014 a number of key Stage 2 contracts have been awarded, following on from three major contracts which were announced in December 2013:

• The US$528 million contract for the construction and commissioning support of the SCPX project facilities in Georgia has been awarded to the Bechtel Enka joint venture, comprising Bechtel International Inc. and ENKA İnşaat ve Sanayi A.Ş.. The scope of work under this contract includes construction of a 16km access road, two 120 megawatt compressor stations and a pressure reduction and metering station. Completion is expected in 2018.
• The contract for pipeline and facilities engineering and project management services for the SCPX project has been awarded to Chicago Bridge & Iron UK (CB&I). The value of this contract is $174 million and completion expected in 2018.
• The contract for the initial phase of the subsea and pipeline engineering and project management services, amounting to $57 million, has been awarded to Wood Group Kenny (WGK).
• The contract for engineering, procurement and construction of the offshore platform living quarters has been awarded to Apply Emtunga. The $32 million contract should be completed in 2017. Assembly and commissioning of the living quarters will be carried out at the ATA fabrication yard in Bibi-Heybat near Baku where topsides units of the platforms will be constructed using local resources.
• The $26 million contract for horizontal directional drilling and line pipe installation for five river crossings of the SCPX project has been awarded to DrillTec GmbH. Completion is expected in 2016.
• The contract for shaft and tunnel construction and line pipe installation for the two river crossings of the SCPX project (one in Azerbaijan and one in Georgia) has been awarded to CSM Bessac. This $24 million contract is expected to complete in 2017.

First gas on Shah Deniz and SCP is planned for late 2018.

BP said the contract awards complemented progress across the Southern Corridor projects. Offshore, the Istiglal drilling rig has completed drilling the latest well in the northern part of the field, meaning that five production wells have now been drilled. An upgrade and recertification program has been successfully completed on the Heydar Aliyev rig, which has now returned to drilling activities in the western part of the field. These two rigs will remain working on the Shah Deniz field to deliver all the wells required to ramp production up to the planned plateau level of 16Bcm/yr.

Additionally, the first consignments of steel for fabrication of the platform jackets arrived in Baku in December 2013, and, on 22 February 2014, the first steel for fabrication of the platform decks arrived at the ATA fabrication yard in Bibi-Heybat near Baku. The $974 million contract for fabrication, load out and offshore hook-up and commissioning of the topsides units of the two Stage 2 platforms is being undertaken by the AMEC-Tekfen-Azfen (ATA) consortium, comprised of AMEC MMC, Tekfen Insaat ve Tesisat A.S. and Azfen joint venture.