Shah Deniz

The Shah Deniz (SD) field was discovered in 1999. It is one of the world’s largest gas-condensate fields. It is located on the deep water shelf of the Caspian Sea, 70 km south-east of Baku, in water depths ranging from 50 to 500 m.

bp operates Shah Deniz on behalf of its partners in the Shah Deniz Production Sharing Agreement (PSA).

Shah Deniz is structured as an unincorporated Joint Venture (JV) partnership. bp is the operator of the Shah Deniz JV. Shah Deniz Stage 1 began operations in 2006. It has the capacity to produce around 10 billion cubic meters of gas per annum (bcma) and approximately 50,000 barrels a day of condensate.

Despite the complexities of drilling the wells, building a platform, constructing an onshore terminal and laying a 700 km South Caucasus pipeline (SCP) through Azerbaijan and Georgia to the Turkish border, Shah Deniz Stage 1 was developed in only seven years. Since Shah Deniz has proved a secure and reliable supplier of gas to Azerbaijan, Georgia and Turkey.

During 2014, the existing Shah Deniz facilities were further de-bottlenecked which increased their production capacity from 27.3 million standard cubic metres to 29.5 million standard cubic metres of gas per day.

In 2018, Shah Deniz celebrated 100 billion cubic metres of total gas production from the field since the start of operations. The milestone was achieved at the end of December, exactly 12 years after the first announcement of the start-up of commercial gas production from the field and start-up of operations of the South Caucasus Pipeline.

In 2021, Shah Deniz celebrated the 25th anniversary since the signing of the Shah Deniz Production Sharing Agreement (PSA). The PSA was signed on 4 June 1996 between SOCAR and a consortium of foreign companies. It was ratified by the Milli Majlis and became effective on 17 October the same year. 

In 2025, bp and its co-venturers spent around $2,315 million in operating expenditure and around $1,087 million in capital expenditure on Shah Deniz activities, the majority of which was associated with the Shah Deniz 2 project.

Production

During the year, the Shah Deniz field continued to provide gas to markets in Azerbaijan (to SOCAR), Georgia (to GOGC), Türkiye (to BOTAS), BTC in multiple locations and to buyers in Europe.
 

In 2025, the field produced around 27 billion standard cubic metres of gas and about 4 million tonnes (around 32 million barrels) of condensate in total from the Shah Deniz Alpha and Shah Deniz Bravo platforms.
 

The existing Shah Deniz facilities’ production capacity is currently about 77 million standard cubic metres of gas per day or approximately 28 billion standard cubic metres per year.

Drilling

During the fourth quarter of 2025, the Shah Deniz Alpha platform completed the rig restart and commenced a series of additional perforation activities on SDA wells.

Shah Deniz Compression (SDC) project

Following the final investment decision in June 2025, the SDC project progressed with the award of several major contracts, including agreements for engineering and procurement support services; topsides construction; jacket fabrication; transportation and installation of the entire SDC platform, as well as the engineering, procurement, construction and installation of subsea structures.
 
Under these contracts, construction activities have already commenced and are progressing on schedule.
 
In September, the project marked a key milestone with the First Steel Cut for the SDC platform topsides facilities, following the successful completion of comprehensive quality and safety reviews.
 
The $2.9 billion SDC project is designed to help access and produce low pressure gas reserves in the field and maximize resources recovery. It is expected to enable around 50 billion cubic metres of additional gas and approximately 25 million barrels of additional condensate production and export from the field.
 
The project involves installation of a new compression facility – an electrically-powered unmanned compression platform, or Normally Unattended Installation (eNUI), and several associated facilities offshore in the Shah Deniz contract area. Additionally, it encompasses brownfield works to be undertaken at the Shah Deniz Alpha (SDA) and Bravo (SDB) platforms, as well as at the Sangachal terminal.
 
It is expected that the construction of the SDC platform will be completed in 2029 for the facility to be ready to receive first gas for compression from the SDA platform in 2029 and from the SDB platform in 2030.